You need to answer a couple of questions about why you want to fix your loan.
Ultimately, your finance consultant will be able to guide you but you get to make the final decision.
An offset account is a standard everyday transactional account that is linked to your home loan. Any money you hold in the offset account directly offset’s the home loan and the interest that is charged. For example, if you have $25,000 in your offset account and your interest rate is 4.50%, you would save approx. $93.75 per month in interest. Remember, interest on a mortgage is calculated daily but charged monthly, so keep as much money in your offset account as possible each day.
Over the years, we have placed a number of our clients with second tier lenders. Most second tier lenders will have minimal or no branches but with the age of technology, this is becoming less of a deterrent. Traditionally, the second tier lenders will have lower interest rates than that of the major lenders.
The first step is to determine the appropriate product and facility to suit your needs and match a suitable lender.
There are many questions to answer as to whether this is the right approach for you. Are you trying to make profit? Or developing and keeping the properties? A feasibility study could be the first step for you to determine if the project is worth investing in. You may also want to appoint a project manager who can manage the project from the initial dealings with council through to the final sale. Your Finance Consultant can assist with connections to these parties.
Not necessarily, we believe the first focus is to have the correct structure set up for you and then matching a suitable lender and interest rate. As a brief example, your “friend” may have a cheap interest rate but if you have the correct structure including an offset account, reasonable interest rate and credit card facility, you may actually save more.
This can be quite a complex exercise to determine, so let the professionals assist you to make the right decision.
Yes and no! We suggest reviewing your finance facilities and structure every 12 months, at worst every 24 months. This is not a sales opportunity, this is an opportunity to provide you with ongoing support and peace of mind. Majority of the time, there are some minor tweaks that are required and gives you ongoing confidence that your financial situation is set correctly for the current and upcoming climate.