The RBA may have decided to keep the rates during the last Melbourne Cup, but we have all seen significant cuts in the rates over the past year or so. This is still good news for anyone who is currently paying mortgage, or those about to take out a loan. If you fall into either of the two groups, then you're in luck. That's because we'll share a few tips with you so you can take advantage of the recent rate cuts. Ready? Let's get started.
One of the most obvious effects of the cuts is that you finally have extra cash in your pocket. Your first reaction might be to spend it all off on a nice dinner, but there are even nicer things you could do with most, if not all of that money. For one, you could make extra repayments. Doing so will help you pay off your loan sooner. A few extra hundred dollars in repayments every month will do wonders in getting the debt off your back.
Speaking of debt, you could also use the extra money to pay off your other debts, including your credit card debts. Or you could even spread the cash out for the repayment of all your debts (home loan, credit card, car loan). The key here is that you use that extra cash wisely and reduce your financial obligations.
The low interest rates and the fact that you now have extra cash only mean good news to you. If you wish to buy an investment property, then now is a great time to do so. You could use the money for investment without suffering from exorbitant rates.
Another way you can take advantage of the cuts is by choosing a variable rate. What this type of arrangement does is shift your interest rate along with changes in the market. So if the RBA announces another cut, your mortgage's interest rate will also go down with it. It is thus worth considering getting a variable rate, unless you have one already.
These are just some of the ways you can take advantage of the current rate cuts. All it takes is a little creativity and you can pay off your loan sooner, or even make money on the side by investing your money. But all these start when you choose the right type of loan. The qualified advisors at Rate Detective can help you with that. They will even provide you with rate comparisons of the country's top lenders, ensuring that you choose a mortgage that's truly perfect for you.