This year’s hot media topics are “high inflation” & raising OCR interest rates. With all the main New Zealand banks, current standard floating rates are creeping close to 6%, and fixed interest rates are almost doubled compared with last year. While our clients are trying to rebook a sharp rate as their current fixed term is about to expire, the question to consider is – is Re-fixing only about grabbing onto the lowest rate possible?
Here are some thoughts that we would like to share with you.
Firstly, when any existing mortgage comes up for renewal, it is a great opportunity to review your current financial situation & work out the best possible option. The key question you need to ask yourself, is what your financial goals are for the next 2-3 years or beyond.
We believe that every client’s financial needs are different. As much as we would like value projections from the media / economists, what we’ve found is that it’s much more effective and relevant for clients to focus more on their own individual financial needs, rather than being influencing by headlines. Say for example, if someone is expecting a lump sum payment soon and their goal is to repay the loan as soon as possible, then rebooking into a long-term lower rate might not be the best option for them.
Lastly, bear in mind that although all banks are offering similar lending options, each bank has different lending products which might suit specific clients lending needs better. In many cases, refinancing to a different lender might be the best option.
Currently Banks allow 60 days or 35 days prior to rebook your interest rates, and you may also be able to review the offered rates online.
We are here to help, feel free to get in touch with us today.
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