Home Loan Interest Rates to touch 9%?

Dear friends, Couple of weeks back, I was going through news in Sydney Morning Herald that the home loan interest rates will keep on going up and will possibly touch 9% in the next couple of years. Currently customer rates are sitting at 7% and to touch the level mentioned, the Reserve Bank of Australia (RBA) has to increase rates eight times. The last time rates were increased was in Nov 2010, which is eight months ago and by the time you read this article, the RBA may have kept the rates on hold in their board meeting on 6th July 2011. Going back in history, in the late nineties the rates touched even 17% however the biggest difference between that time and present is that the property values at that time were much lower than today. In the last two to three years the property values have gone up partly because of the government incentives like extra first home grant, low interest rates and mostly because of the acute housing shortage and a tight rental market. We have also seen the interest rates going up seven times from Oct 2009 to Nov 2010. These jumps in rates have put lot of pressure on borrowers and to experience more rises will put them in more pressure and the property market may experience a further decline, which simply means that the country can head to another recession, therefore my understanding is that the rates will not touch 9% however there could be a couple of rises and then they might come down and that is why you should get an advice from an experienced and licensed home loan expert who can suggest whether to fix your home loan or leave it variable as there is no blanket solution for this. You are more than welcome to contact us on 02 96763417 to discuss your situation.

Exit fees on Home Loans, no more !

From 1st of July 2011, the lenders are not allowed to charge exit fee (or early repayment fee) to the home loan borrowers on variable rate loans. This is law now and any lender who charges this fee will be doing so against the law. There are some exceptions though which I will explain. First of all, this ban does not apply on the fixed rate home loans, you see when you take up a fixed rate home loan, you enter into a contract with the lender that you will pay the repayments for a specific time-frames at the rate agreed. Banks source these funds externally and the penalty applies to them which gets charged from the borrowers. The other exception is that if you signed your loan contract prior to 1st of July 2011, there is a good chance that you will have to pay an exit fee (some lenders may waive that). What does this law mean to you? It simply means that you are in a more advantageous position to look for a better alternative, we are doing our part by helping our customers get a better deal on their home loan, please contact us if you think that you are on a higher rate so that we can assess your situation and get you a better deal from another lender, our services are absolutely free, contact us on 02 96763417 or visit our web-site on www.gainhomeloans.com.au, leave your contact details there and we will get in touch with you.

RP Data property report, get it free !

Most of you would know that we provide RP Data property reports absolutely free to all our customers. This report can potentially save you thousands of dollars by putting the right offer to a property you are interested in buying and also outlines the historical sale figures, land size, median value and also gives extensive information about the suburb. This report is also useful for current property owners who would like to know the current worth of their home which will help them to determine if they are eligible to buy investment property (by using equity) or consolidate their debts and reduce the monthly repayment. Please visit our web-site www.gainhomeloans.com.au and order your free report today!

by Navjeet Singh Matta, ASIC Licensed Mortgage Broker also Director- Gain Home Loans (Full member MFAA)