Home Loan Tips:
Home Loans are often the largest financial investment weâ€™ll make in our lives, but despite this very few people realize the importance and benefits of managing your bond account wisely.
Keeping your mortgage account manageable is often tougher than one would expect. And while simply trying to keep your bond account out of the Red Zone may be wise, you could be missing out of the benefits your home loan can offer you.
Here are some tips on how to make your home loan work for you for a change.
Firstly, itâ€™s important to know that the interest rate on your mortgage is the one of the most important component of your home loan. The lower the interest rate the less your bond repayments will be.
2005 saw a number of new home loan providers centering the SA Home Loans market. The extra competition focused many banks to offer their customers better rates.
2006 should be no different, and if the interest charged on your home loan is not lower than 1% below prime at least youâ€™re paying too much.
Home Loan Switching is a growing phenomenon. More and more South Africans are realizing that by switching the bonds theyâ€™re able lower their bond repayments and the mortgage term by requesting a better interest rate.
Your home loan holds an enormous amount of financial potential, this year why not make use of that potential to improve your standard of living.
Credit Cards and Personal Loans are often the cause of many financial difficulties, simply because youâ€™re begin charged huge amount of interest. You barely able to lower your debt after paying off these high interest accounts.
Making your home loan work for you.
This is where you mortgage can start to work you for a change. The interest charged on a home loan is usually 1% – 2% below the current prime rate, while the interest charged on your personal loans, credit cards and other accounts are always higher than the current prime rate.
By taking the funds available to you in the home loan you can pay off your credit cards and personal loans. This means your bond repayments will increase slightly but your overall monthly expense is lowered because youâ€™re paying less interest now. This method of consolidating your debt will also allow you to pay off those loans quicker.
Home Loans Switching and Debt Consolidation are only two methods of lowering your monthly expenses. There are many more ways you can get your home loan to work for you, though I believe that these are the two fastest and most powerful ways to take control of your debts.
Speak to a Home Loan Consultant
Since each home loan is unique itâ€™s best to speak to a consultant before you decide on either action. Youâ€™re welcome to complete this short form online, a consultant will contact you personally. Note this is a free service and the consultants to totally independent, which means youâ€™re getting the best advice.
Read these related topics:
- How a home loan works
- Is mortgage consolidation a smart move?
- Lower Your Debt Today
- A Guide to Home Loans in SA