Wednesday, February 8, 2012

Will The Banks Increase Home Loan Rates?

After the unexpected decision by The Reserve Bank Of Australia yesterday to keep the official cash rate on hold, there is much speculation today that the banks may increase their standard variable rate mortgages.

We have heard from the banks that the cost of borrowing money has increased since the credit crunch, and at the moment shows no signs of easing, with the crisis with sovereign debt levels, especially in European countries.

Most, if not all banks have increased there lending margins by at least 1% since the credit crunch, so there has been a considerable cost to all mortgage holders already.

I guess the interesting point is, if or when funding does get cheaper, will the banks pass on the cheaper rates to there customers? I guess we will see.

On the positive side, there is still much competition between the banks and lenders. Some of the smaller banks and lenders are offering extremely competitive rates these days. A mortgage broker is only a phone or email away, to see if you could save money with your current home loan. It really only costs nothing more than a little bit of your time to compare you current home loan.

It is important though, when thinking about switching your current home loan, to consider the fees, like mortgage exit fees, application fees, government fees, as these costs may impact any possible savings a new home loan may give you.

A good mortgage broker will take into account these fees, so you will get an idea of how much you may save when considering new home loan.

If you would like to contact a mortgage broker in Perth, please contact me anytime. Also too, please leave any comments below, we love reading what you have to say.