Hi, this is Connie from Prosperity Finance. Your lifetime financial advisor.

Hot on the heels of 3.95%, one-year mortgage rate offer, ANZ has reached the lowest lending interest rates on record. BNZ has unveiled two year 3.99% loan rate as mortgage wars intensified. Our enquiry phones are getting busy these days, with people asking the questions like “what actions should I take to capture this opportunity and how could I enjoy the saving action?”

As a specialist mortgage advisor, we can help you to navigate all the options including but not limited to re-fixing interest rates, renewing loan structure, etc. 

Mortgage Interest Rates Wars Intensified

Video Timeline

1. Interest rates raced to the bottom this week -- 00:16 

2. What’s break cost? -- 01:18

3. Before you rehearse scenarios of re-fixing a lower rate, there are some important things to consider.  -- 02:03

Interest rates raced to the bottom this week

Hot on the heels of 3.95%, one-year mortgage rate offer, ANZ has reached the lowest lending interest rates on record. BNZ has unveiled two year 3.99% loan rate as mortgage wars intensified. And, at the same time, loan providers appear to be in a “race to the bottom” with rates dropping to below 4%, in some cases. You might be looking at these loan rates dropping and wondering how you can get a slice of the savings action.

Everybody wants to seize this historical moment, and that’s the reason why our enquiry phones are getting busy these days, with people asking the questions like “what actions should I take to capture this opportunity and how could I enjoy the saving action?”

As a specialist mortgage advisor, we can help you to navigate all the options including but not limited to re-fixing interest rates, renewing loan structure, etc. 

 

What’s break cost?

If your loan is about to expire in the next 60 days, we can talk to the bank and help you lock your next interest rate now.

However, if your loan will expire over 60 days, then you would likely to pay a break cost. You will need to know how much you can save by re-fixing a lower rate, and compare it to a break cost. We are always here to help you make decisions. 

If you are our existing clients, please attach your recently loan statement,  your interested fix term, and signed declaration letter. Then send it to our email (support@profin.co.nz) with subject in re-fix. 

If currently you are not our clients, but also want us to review your loan structure by an experienced advisor. We are also happy to help you find the best solutions. Please complete a form by clicking here.

 

Being proactive is good, but before you rehearse scenarios of re-fixing a lower rate, there are some important things to consider.

1. Splitting your mortgage with different interest rate fixed term.

Splitting loans with different interest rate fixed term allow your loan come off at different time. Just in case interest rate do go up, then the extra payments required as result of higher interest rates is not going to be as big as if all the loan come off at the same time.

2. If your net cash flow is expected to reduce in the coming 12 months or 2 years.

In some cases, like your partner is not going to work in the next 12 month, or starting a new business, these uncertainties would result in less money to pay the loan. Don’t lock your loan interest rate entirely under the short term, which may allow you the flexibility.

3.  Review your loan structure, especially your repayment structure.

For example, some people save some money in their bank account just to earn 2% saving interest, which results in paying gratuitous 4% of loan interest rate. Obviously, it’s wise to utilize your spare money and save interest costs. Just imagining if you could pay off the loan 5 years earlier, you could save hundred grams of interest cost.

If you are very lucky to re-fix your interest rates now, you may also need to re-consider the same question above, should you keep your current repayment structure, or choose to pay more to speed up your loan repayment process, or even pay less to save for the uncertainties. The key to make this decision depends on your future goals. Let’s say you are thinking about upgrading home or buying investment property, in this case, reducing repayment amount is a good option for you. 

If you are our existing clients, please attach your recently loan statement,  your interested fix term, and signed declaration letter. Then send it to our email (support@profin.co.nz) with subject in re-fix. 

If currently you are not our clients, but also want us to review your loan structure by an experienced advisor. We are also happy to help you find the best solutions. Please complete a form by clicking here.

Disclaimer: The content in this article are provided for general situation purpose only. To the extent that any such information, opinions, views and recommendations constitute advice, they do not take into account any person’s particular financial situation or goals and, accordingly, do not constitute personalised financial advice. We therefore recommend that you seek advice from your adviser before taking any action.