do you guys have any criterias on selecting the right mortage for your IPs from so many broker? how do you know which one is the good one? as so many broker will tell you that they have the best on market or something like that.
if you are on 5 year fix loan, would you be able to refinance say when the loan goes for 2 years and the interest rates drop?
i scan through yourmortage.com.au and found so many diffrent initial interest rate? why can we just choose the cheapest one? why people sometimes still go for dearer one which is offer by a bank such as nab, westpac, etc
the link: http://www.yourmortgage.com.au/rates/index.cfm?action=productList&category=termloanGood question.
I get many folks who when hearing what I do just ask me what is the best mortgage?
Like asking what is the best car? It all depends on the situation and what you want the mortgage to do.
You can get out of a five year fix loan at anytime, however if the current var rate is well below what your fixed rate is then there will be a penalty fee associated with that break. Sometimes it is still worth paying it.
Be wary of honeymoon rates. I rarely use them. It can usually be shown that, whilst there might be a saving in year one, these are more expensive than a good discounted rate in subsequent years.
Good luck with your search!
Cheers,
Simon Macks
Mortgage Broker
[email protected]
0425 228 985Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.
Hi 007, Milen 007, (Bond, James Bond)
Fees and flexibility.
All changes come at a cost.
If you want to hedge your bet, go for a split loan.
The Broker doesn’t have the product, the bank does.
Trust thy Broker before thy Bank.Regards, Phil
Hi,
To narrow down the selection criteria, I like to look at the comparison rates for each loan that I am considering. Comparison rate legislation came in here in Qld this financial year. If you don’t know what a comparison rate is it would be worth while having a read about them. There are a lot of articles around at the moment that go into details. Be wary though that comparison rates do not include unforseeable charges that may be associated with a loan. eg a fee for redraw.
From there, I look for the features in the loan that I need/ will use (so that I am not paying a higher interest rate for features in a loan that I do not need).
Be careful of fixed rates. Usually there will be a break cost if you refinance part way through the fixed term; and usually the expense is greater the longer you have left to run on that fixed term.
Hope that helps a bit.
May good fortune befall you! Happy investing.
Nathan.
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]thanks heaps on instant respond. Say all i need is just interest payment only for my ip loan, would it affect much if i just choose the lowest term say:
ACE HL RI Variable – Standard initial interest 5.89%, comparison rate 5.96 ongoing fee nil total startup cost 1045compare to
ANZ RI Variable initial rate 6.57, comparison rate 6.61 ongoing fee none, total start up cost 600
why some people choose ANZ instead of ACE? will i be better of with ACE?
It’s a bit like property investing. You need to know what you’re after and then go and look for it. By that you need to define the type of loan you are looking for. 9 times out of 10 people make the wrong loan product choice rather than choosing the wrong lender. Do you want:
– Basic variable
– Fixed rate
– LOCThen ask the broker for their best “XXXX” product.
This is a much better approach as then you are comparing apples with apples (rather than comparing a LOC with a basic variable).
Spend just as much time on choosing the best product type as you do finding the right lender.
Cheers
Stu
Sapphire Mortgages has a comparison rate of 5.88% (interest rate of 5.85%).
http://www.sapphiremortgageservices.com.au/crs_banksia.asp
Cheers
Stu
We have just chosen the 5yr fixed for our first wrap and if the rate go up to say 8% and you are fixed in at 6.6% you may even get a refund from the bank (as it saves them!) and you could break out of the loan IF YOU REALLY NEEDED TO!! The penality could be in you favor!
Leah
hi stu, the link is not working. Both comparisons i choose both are standart variable loans. are they the same type? or diffrent?
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