- Posted 22 Jan
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Once you’ve been through the process of getting a home loan, you know how much you can borrow and what your likely monthly repayments will be.
The issue that arises once you’re in your home and paying off your mortgage, is around economic and personal financial changes, particularly if they are unexpected.
What do you do when interest rates rise, resulting in your mortgage repayments no longer being sustainable?
Follow our advice and do the following:
Access Your Savings
If you’ve been smart, you’ve taken out a home loan that allows you to still maintain a savings fund each month.
When interest rates rise, tap into this savings fund to top up your repayments while you figure out your next steps. This can be a great short-term option that allows you to take a breath and consider your options.
If you don’t have a savings plan, it’s time to implement one now.
If you’re starting to feel uncomfortable with your home loan repayments, it might be time to look at your options.
Refinancing is a good option that allows you to change your home loan option and find a more suitable mortgage that meets your current needs.
It’s a great option, particularly if your lender seems to be raising rates while others are not.
This is where a mortgage broker can be of the best assistance. They will help you find the right home loan to suit your needs, particularly if you don’t have a lot of spare time to do a lot of research.
Australian Credit and Finance can provide you with information about lots of different lenders, so make sure you give one of our experienced staff a call to discuss your options if you’re considering refinancing.
Chat With Your Current Lender
If you’re faced with interest rate rises that make it almost impossible for you to meet your mortgage repayments, it’s time to pick up the phone and make an appointment to meet with your current lender.
They should be your first port of call when things are getting tough. By chatting with them and making them aware of your situation, it allows them to provide you with options.
They may be able to offer you financial assistance or put your repayments on a short-term ‘holiday’ to allow you some breathing room to get things back on track.
If you’re currently faced with high interest rates, it might be time to refinance or at least consider your other options. Chat to the team at Australian Credit and Finance today to find out what options are immediately available to you.