You may have noticed the banks are fighting for marketshare. House sales are sluggish so they’re using cut-price interest rate offers to win your business.
Tempted to refinance? Tread carefully.
An ad with a juicy rate in the headline may seem like a great deal. However, these rates are often available across the board. Any mortgage broker worthy of the name can get you deals that are as good or better. As we say in the finance industry, the difference between one bank and another is the colour of their cheques.
But there’s an even better reason not to jump at a low rate offer. It’s because refinancing is a costly exercise that may bring you no closer to your actual goal – which should be to pay less over the length of the mortgage and become debt-free sooner.
We know one homeowner who thought refinancing would magically get rid of his mortgage. In the end, after all the costs had been added up, he saved just 87 cents a week.
That’s right – 87 cents a week.
We think there are better ways of structuring your loan to get rid of your mortgage. To find out how, come to my one-day seminar in March.