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The Age Old Decision... to Fix? or to Float?

As a business, this is something we are asked by most people we talk to. Generally, as consumers, we look for certainty in our purchases – will the car we buy today last into the future? Will the phone I buy today last until next year; before a new model comes out? Will the mortgage I fix work for me in 2 years’ time?

There is significant disparity between floating and fixed rates in the current falling interest rate market. We are currently recommending shorter term fixed rates between 6 -24 months. We believe interest rates will fall further over the remainder of this year and into 2016.

For anyone re-fixing onto a lower rate, this is an ideal time to re-consider your repayment amount.

A minor increase can substantially reduce the mortgage term and effectively save a considerable amount in interest.

For example, an increase of $30 per week in loan repayments on a $350,000 mortgage over a 30 year term @ 5.00 % pa interest rate will reduce the loan term by 4 years! More significantly, this will save $50,000 in interest costs.

If you would like to know how to implement these changes so that you can take advantage and save, please give us a call.

 


1st home buyers with only 10% deposit

Buying your first home could be closer than you have been led to believe. There are banks that are crying out for your business as a first home buyer even if you only have a 10% deposit saved. CALL US if you or someone you know is in the market for their first home and have been worried about not having a 20% deposit. We may be able to assist.

There is still a myth that you MUST have a 20% deposit to purchase a house in NZ. The FACT is you can purchase a house with a 10% deposit from a wide range of lenders.

In 2012 NZ Registered Banks were forced by the Reserve Bank to REDUCE their lending to people with lower deposits. The key here is REDUCE, not completely stop lending to people with only 10% deposit raised.

And it’s right now that we are organizing LOW Deposit lending for people all across the Waikato and beyond, ensuring that people can actually realize their dream of home ownership. These mortgages are competitive and favourable for our clients with flexibility and added value from the lenders.

Home ownership is still affordable in NZ – and we would be suggesting that the time to get in is now! 


Stay Calm and in control

When it comes to borrowing money many people feel like they have little control over their circumstances and that the banks hold all the cards. The reality is that you do have control – provided you stay calm and consider the following

– Control What You Can.

1. Your Debt - You can determine how much you want to borrow. Yes,the banks will have limits and criteria, however you know what limit is comfortable for you.

2. The Cost of Your Debt- By considering the various options you can reduce the COST of your debt (the amount of interest you pay long term). Examples of this are:

• Fixing the term to lock in a low interest rate
• Saving a little more and increasing the amount of your
deposit
• Increasing your regular weekly, fortnightly or monthly
instalments. This can be done on either fixed or
floating interest rate loans.
• Revolving credit – this does require discipline but can
be a useful tool in reducing the cost of your debt
• Repaying lump sums at regular intervals
All this can be achieved by sending us an email with your
instruction and quoting your loan account number


3. Who you borrow from – yes it’s a free economy! You can change your lender at any time as this is a factor
you do have control of. Each lender offers different benefits/advantages – so as your lifestyle changes, your
lender may need to change too!

4. Control the conditions of your mortgage Although Banks have terms and conditions, by shopping around, you can choose a bank with conditions that benefit you and don’t cost you more. An example of this is that some banks insist that you obtain a Registered Valuation irrespective of whether you are borrowing less than 80% and where a purchase price exceeds $500,000 or in the event the purchase is by private treaty. Other banks do not require this and are more flexible. So choose the lender according to your wants and take back the control. 

Furthermore, they are now endeavouring to dictate who does the Valuation for you – another example of taking
away your choice. As a broker we are able to evaluate your wants and needs and find a bank that best suits you as opposed to a bank selling you what they offer. 

Call anytime – I’m here to help!


Get in touch

 

Our advice comes supported by many years in the mortgage and insurance industries. So contact us today!

0800 800 333  wayne.oliver@sharenz.com
 sarah-jane.reay@sharenz.com

07 856 2960  
07 856 2962    

This website is for general information purposes only. We encourage you to
call us or email us in confidence with specific questions.
 

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