Concerns about mortgage management seem to be on the rise alongside the official interest rate increases once again by 0.5% this time, as the RBA announced at the beginning of July 2022.  Uncertainty brings with it instability, and this is where a Fast Repay Home Loan Broker comes in to take your mortgage worries off your hands. Continue reading to learn how you can manage your mortgage payments with everything that’s going on.

Quick tips for mortgage management

Covid-19, lockdowns, Ukraine-Russia conflict, interest rate peaks, oil price surge… and the list goes on… In light of all of the global, regional, and local instability and financial rollercoaster, here are some tips to manage your mortgage. 

1  Pay interest and principal

A principal is an amount you borrowed and must repay, while interest is the fee charged by the lender for giving you money.

So make sure you're repaying both the principal and the interest because your loan remains the same if you simply pay off the interest.

2  Prioritise making extra repayments

Deciding ahead of time to make extra loan instalments is a smart technique. Managing to get a better deal on your interest rate means you keep paying the higher amount. Alternatively, if you receive a tax refund or an unexpected bonus, you can decide to put some or all of it towards your mortgage.

3  Make repayments twice a month

Simply opting to fulfil your repayments twice a month instead of once can save you a substantial amount of money. It all comes down to timing. There may only be 12 months in every year, but there are 26 fortnights.

4  Evaluate your current rate

Rates in the market vary widely, so make sure you're on the best deal with the lowest rate. It's really important to check the one-off and ongoing fees (like application fees, monthly fees, annual fees etc.) to check which ones can be abandoned.

5  Use an offset account

Unlike interest earned on money in a savings account, money sitting in an offset account will not attract any taxes.

Do you require help with managing your mortgage?

The Australian government has reportedly concentrated on numerous policy initiatives to address the issue of housing affordability in Australia's metropolitan centres, according to the Journal of Urban Policy and Research. This indicates that there is a severe issue with financial stress linked to mortgage purchase and management and housing affordability. Fast Repay Home Loans experts are here to take the pressure off you and make getting the home loan that best suits you as simple as quick as possible! We will do all the intensive work on your behalf, and we will also provide you with guidance.

What are you still waiting for?

Call us today, and together, we'll secure the mortgage you deserve.

Monetary policy decision: interest rate increase

The Board of the Reserve Bank of Australia announced an increase in the cash rate target by 50 basis points to 1.35% and an increase in the interest rate on Exchange Settlement balances by 50 basis points to 1.25%.

In a media release following the RBA Board meeting on July 5, 2022, governor Philip Lowe made a statement on the monetary policy decision. Fueled by COVID-related disruptions to supply chains, the war in Ukraine and strong demand which is putting pressure on productive capacity, global inflation is on the rise, explains governor Philip Lowe. Monetary policy globally is responding to this higher inflation, but it will take time before inflation returns to target in a lot of countries.

He continues to explain that inflation is estimated to peak later this year and then decline back towards the 2–3 % range next year. As global supply-side problems continue to ease and commodity prices stabilise, even if at a high level, inflation is expected to moderate. Higher interest rates will also help establish a more sustainable balance between the demand for and the supply of goods and services. Medium-term inflation expectations remain well-anchored.

Curious to know how this affects you?

Loan repayments will increase for you. This is why you must get in touch with us. We assist you in lowering and better managing your financial obligations. Call us to discuss your debt, overall loan repayments, and other commitments. We check your interest rates to make sure you’re on the lowest one!  

Call us today to get prime guidance from Fast Repay Home Loan brokers who will provide you with the best options, according to your specific situation.

Disclaimer: Information included in this post is of general nature, it has been prepared without taking into account your specific situation. It is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. You should not make any decision, financial or otherwise, based on any of the information presented here without undertaking independent due diligence and consultation with a professional accountant or financial adviser.