I have just been talking with Paul, my mortgage broker.
He told me that in the past few weeks there has been aggressive discounting by the major banks (and the smaller funders as well) to compete for market position. They have been dropping variable rates to attract competition. However there is a trick to getting the discount.
To get a reduction in your interest rate you have to ask for it! Who would have thought it could be so easy?
Recently there has also been a rapid decrease in fixed rates, so for a 3 year fixed period you would be looking at a rate of about 6.43% which is nearly 1.4% under the current standard variable rate (not including any discounts).
Paul said that all this hints that we may see a decrease in the official variable rates over the next 6 months but will depend on other factors and unfortunately his crystal ball is a bit cloudy.
So with all this in mind you would have to be thinking it is a great time to review your situation and either approach you current bank to reduce your lending rates or talk to someone about reviewing your overall position to save a few $$. As a guide, if you have loans totaling over $250K you should be looking at a variable rate of around 6.9% and over $500K a rate of approx 6.8%
Why not contact your broker or bank today?
As you would know, I am not in the business of selling home loans but if you are not happy with who you are currently dealing with (or you don’t even know who to talk to) shoot me an e-mail and I can put you in touch with Paul.
I would love for you to leave a comment here to tell others of your experience with this as I am sure it will help them to get motivated and learn from your experience.