As interest rates rise, homeowners may be tempted to change lenders and refinance their mortgage for a lower rate.
MELBOURNE, Australia – August 1, 2022 – (Newswire.com)
According to Liberty, a non-bank lender, borrowers should be wary of long-term costs when they look to refinance their home loan.
Australians are refinancing at record levels. PEXA reported a 16% lift in the volume of refinancing transactions compared to this time last year. The latest lending indicators from the Australian Bureau of Statistics revealed that $16.7 billion worth of mortgages were refinanced in April this year.
According to Liberty’s Head of Communications Heidi Armstrong, a lower rate can be enticing, however, the switch could end up costing borrowers more in the long term.
While repayments and interest rates may be lower, Ms. Armstrong advises to pay close attention to the overall term of the loan when refinancing.
“Be mindful that you don’t end up making more repayments and paying more interest in the long run.”
It’s important to remember that interest rates are just one of the many variables to think about. Homeowners should consider all costs involved in refinancing, such as application fees with the new lender and discharge fees with the current lender.
“While variable-rate loans often have low or no discharge fees, if you’ve fixed your rate – you could experience some expensive break costs. To get a full picture, make sure you do the math.” Ms. Armstrong recommends online comparison calculator tools like ASIC’s MoneySmart mortgage switching calculator to check how much money can be saved.
As a leader in the Australian mortgage space, free-thinking lender Liberty works closely with borrowers looking to refinance.
“At Liberty, we take a personalised approach to help ensure each borrower receives a solution to fit their unique needs.”
Ms. Armstrong encourages borrowers looking to refinance, to speak to an expert who can help them navigate the process and refinance with confidence.
“Every dollar counts, so it can be helpful to get an expert’s opinion before you decide to jump ship.”
A Liberty Adviser can walk homeowners through their options, to find a tailored solution that best suits their circumstances. They can help determine if refinancing is right and make the process smoother.
The non-bank also encourages borrowers with irregular income or who are self-employed to consider more free-thinking home loans when looking to refinance.
Approved applicants only. Lending criteria apply. Fees and charges are payable. Liberty Financial Pty Ltd ACN 077 248 983 and Secure Funding Pty Ltd ABN 25 081 982 872 Australian Credit Licence 388133, together trading as Liberty Financial.
Group Manager – Consumer Communications
P: +61 3 8635 8888
E: [email protected]
Press Release Service
Liberty Encourages Homeowners to Consider the Real Cost of Refinancing
Source: Financial Content