Forget the RBA – get your own rate cut!

Each month (except January) the Reserve Bank of Australia (RBA) meets to discuss our official cash rate and decide whether any adjustment is required in order to stimulate (or reign in) the economy. Whenever a rate movement is announced, CANSTAR sees a doubling in the number of people looking specifically to  refinance a home loan.

What does a rate change mean for your finances?

Whether you celebrating or curse the RBA when rates are lowered depends on whether you’re a borrower or a saver. For current borrowers, low interest rates are terrific and many would hope for further cuts. For savers, low interest rates are a downright curse and many would have breath a sigh of relief when rates are kept on hold.
Of course, the above emotions are reversed when interest rates rise!

For borrowers

Irrespective of rate cuts or not, those who currently have a mortgage are in clover right now, with home loan interest rates super-low. Currently on our database of loans, minimum, maximum and average home loan rates are as follows:

	Standard Variable	Package Variable	1 Year Fixed	3 Year Fixed	5 Year Fixed
Average	4.91%	4.44%	4.48%	4.54%	4.77%
Min	3.99%	3.98%	3.79%	3.99%	4.28%
Max	5.99%	5.10%	5.59%	5.59%	5.89%

Rates as at 7 July 2015, products on Canstar database.
As you can see from the above table, borrowers shouldn’t be complacent. Despite our low rate environment, there is still a two percent difference between the highest and lowest variable home loan rate on Canstar’s database. Even a half a percent reduction on a $300,000, 25 year home loan equates to almost $90 per month, or one thousand dollars per year. That’s easy cash in hand.
While the cheapest home loan isn’t always the right choice for your situation, the good news for borrowers is that there are a number of financial institutions offering a variable rate under four percent, so there’s plenty of choice out there. Currently on our database, there are ten variable rate home loan products available under four percent. There are also one, two and three year fixed rates available under four percent.

For savers

For those who are cashed-up as opposed to being in debt, our low official cash rate is not such great news. And of course, there is still economic chatter about rates being lowered throughout this year, so if you have cash to invest, think carefully about your options! You can compare current term deposit interest rates here.
While it may be little comfort, at least our cash rate could be worse!


Whether you’re a borrower or saver, it’s important to shop around for the best rate possible. Even with our currently-low overall interest rates, there’s still a significant difference between the highest and lowest home loan rates and term deposit rates in the market. Don’t settle for average!

Elite Wealth Creators have been involved in the property and finance industry for over 20 years.  Our Investment Property Strategists deliver investment grade properties to the investment market and mediate between the developer and the investor. We also assist first home buyers in purchasing their first home in QLD through our house and land packages – this includes receiving $20,000 cash back towards their mortgage by buying one of our full turn-key packages.
Our service will take you through the complete process of buying positive cash flow property, including:
• educating you on positive cash flow and the ability to pay your mortgage off years in advance
• saving you thousands of dollars in interest
• supporting you in the decision on which property to buy
• assisting in the organizing of your finances, if required
• preparing you for settlement of contracts
• liaising with other professional advisers on your behalf if required.
Our Strategists specialise in delivering quality positive cash flow property and also helping investors pay off their mortgage years in advance

http://www.elitewealthcreators.com/
sales@elitewealthcreators.com
1800 GO ELITE