Grow Your Wealth First
If you are looking to grow your wealth now is the time to speak to a Home Loan Broker Brisbane to ensure you are maximising your current situation to make sure you reach all your financial goals.
Perhaps you bought your home a few years ago and there is some equity in it. A fully qualified home loan broker can arrange a bank evaluation so as to understand what the property is currently worth and what equity you have. If your property has grown in value you may be able to release some equity to buy another property, shares or managed funds, but that’s another story for another post or mortgage broking article.
Fixed vs. Adjustable Rate Mortgages
Mortgage Rates Change Over Time
Mortgage rates also change over time so you may be able to refinance your loan to reduce your mortgage repayments and give you more money each week. I know I would prefer the extra funds to be in my pocket and not the banks! Mortgage rates and Interest rates are at historic low rates so now is the time to take advantage of them and pay your loans off faster. There are strategies we can help you with on paying your home loan off sooner and using your home to grow your assets.
Paying Off Your Home Loan Quicker
Let’s say you bought your home 5 years ago for $500,000. If the property has grown over that time and the bank value it at $600,000 and your mortgage is $400,000 you have some equity.
If you want to keep your loan to value ratio at 80% so you are not paying Mortgage Insurance you can borrow up to $480,000 (600,000 x 80%).
After deducting your current loan amount of $400,000 you have $80,000 potentially to use.
In this scenario you would be able to potentially buy another property or invest in shares or managed funds. The bank will also make sure you can service the debt by looking at your income and your other assets and liabilities. You don’t have to worry about the numbers, a qualified mortgage broker can do it all for you. You can do the same thing for car loans Brisbane just talk to your mortgage broker about refinancing.
Use this mortgage calculator to work out a repayment plan that takes into account the equity or the value of your existing property.
By paying the interest only portion of the loan you can save thousands. Your property continues to appreciate in value over time, so by paying the principal you are merely wasting money that could otherwise be spent on renovations that will add thousands to the value of your property.
This is one of the best ways to break into the property market.
Glossary of terms.
Amortization period refers to the time period it will take to repay a mortgage in full. Because mortgage lenders charge interest on mortgage loans, the longer it takes to pay off the mortgage, the more interest one pays.
Source: First Foundation.