Do you have any idea about current interest rates and whether or not you might qualify for good home loan interest rates from local Kwinana, Baldivis or Rockingham lenders? There are some other things to consider, too.
Fixed or Variable
A fixed rate may enable you to lock in at a set rate for a set period of time. But a variable rate can help you take advantage of the fact that interest rates could drop. Conversely, it’s a bit of a gamble because interest rates could also rise. The right scenario for you will depend on several factors including how well-qualified lenders deem you to be, as well as the state of interest rates when you opt to get a mortgage.
Beyond finding a good interest rate, have you carefully considered choosing the right amortisation period for your home loan? Yes, a longer amortisation period will mean that your mortgage payments are more manageable but in the long run, have you considered the overall impact on how much your property costs you in total?
Have you made a decision about how frequently you want to make mortgage payments? A monthly payment may seem logical, especially if you are a first time home buyer. If you’ve been paying rent for any length of time, your budget has likely become accustomed to a large monthly payment to cover rent. But with mortgage payments, you might realise that you can pay your mortgage monthly, weekly, bi-weekly or bi-monthly. The more often you make payments, the more money you can save on interest.
Some Other Factors to Consider
Beyond the above factors, some other things to consider include:
Which lender will you deal with? Do you go to your regular bank by default because you’re comfortable with them and believe they will give you a good deal based on the fact that you’ve been doing business with them for years?
Many mortgage brokers in Kwinana, Baldivis and Rockingham would advise against this. It never hurts to shop around. In the end you may opt for your usual bank but you don’t know what sort of savings is available to you unless you look. Mortgage brokers can help you suss this out without your having to do a lot of leg work.
Some lenders are more flexible than others. One lender may charge you a penalty if you pay your mortgage off early. Another may not. Some offer the ability to skip a payment once a year. Others offer the ability to drop an extra chunk of money into the mortgage at will–so that you can take bonuses, tax refunds, or other influxes of money and pay your mortgage down faster.
Ultimately, there’s no way to know what’s right for you until you do some number crunching to find out how much you’ll be able to afford and to find out how much you’ll pay in interest. Consider talking to the mortgage brokers at Rockingham’s Mortgage Gallery for helpful advice–with no obligation.