Have you recently moved house? Did you purchase your first home and then either move into a rental, or perhaps purchase a new home yet held on to your first property as an Investment? You may even have changed your residence years ago and never thought much of it. Well now is the time to look closer at how your loans are set up. It may be costing you thousands.
When a customer borrows from a lender to secure a Residential Property, the loan fits into one of two categories - an 'Owner Occupied' or an 'Investment'. Up until last year there was essentially no difference, however, the changes have now clearly distinguished the two and any property owners who have not considered the changes are at risk of paying too much on their loans. The difference varies between lenders but can be nearly as high as 0.40%, which on a loan of $500,000 can be up to $2,000 per year.
As there was previously no measurable difference in the categories of loans, many people would simply move out of their property and into a new home. The interest rates remained the same even if the bank changed the loan purpose from Owner Occupied to Investment - or vice versa. How ever now these same loans have been targeted by lenders and their is a distinctly more expensive interest rate for an Investment loan. So leaving the loans unchecked for a few years will finally have caught up with you.
It can be as simple as calling your bank and asking them if they have your loan listed as an Investment Loan or an Owner Occupier Loan. A savvy computer user may also be able to pick the difference from their Internet Banking. These new changes also highlight the benefits of having a Finance Professional working for you - as any industry changes are firstly noticed by them. Communication of this information can help you assess whether you need to review your loans.
All Mortgage Consultants at Prefix Finance keep track of industry changes and work to keep you ahead. Our services are equally as important for information on loan offers and discounts. There has never been a better time to engage the services of a Prefix Finance Broker.
If you would like more information you can contact us here.