Powered by MOMENTUM MEDIA
Powered by momentum media
Powered by momentum media
nestegg logo

Borrow

How the cash rate hold can still save you thousands

By
  • November 06 2019
  • Share

Borrow

How the cash rate hold can still save you thousands

By
November 06 2019

While yesterday’s cash rate announcement won’t have an impact on mortgage rates, borrowers are still around $34,602 better off based on past cuts, according to new research.

How the cash rate hold can still save you thousands

author image
By
  • November 06 2019
  • Share

While yesterday’s cash rate announcement won’t have an impact on mortgage rates, borrowers are still around $34,602 better off based on past cuts, according to new research.

Couple inside house

Canstar data has shown borrowers who have received part of previous rate cuts will still save thousands of dollars from the previous credit reductions.

As a result, Canstar’s Effie Zahos has advised mortgage-holders that they should look to change their rates if they haven’t received the full value of previous cuts.

“Borrowers who have had their loan for three years or more and have not renegotiated a better rate with their lender are likely on an interest rate of around 4.04 per cent,” she stated.

Advertisement
Advertisement

“These home owners could be paying up to 1.35 per cent more than they need to be given the lowest variable rate today is 2.64 per cent.”

Couple inside house

For borrowers who received 0.59 per cent of the 75 basis point reduction so far, they will have a rate that has been reduced from 4.41 per cent to 3.82 per cent.

Such a reduction means that the average borrower will be in a position to pay off their home loan four years and two months earlier than they would have otherwise.

“Borrowers maintaining their home loan repayments on pre-cut levels in a period of falling interest rates and in a record-low interest rate environment is the right combination to see home owners get ahead,” Ms Zahos outlined.

She said that borrowers can be taking advantage of favourable market conditions, including low credit rates.

She said some mortgage-holders are already catching on, “preparing for potential tougher times ahead and building a financial buffer”.

Forward this article to a friend. Follow us on Linkedin. Join us on Facebook. Find us on X for the latest updates
Rate the article

About the author

author image

Cameron is a journalist for Momentum Media's nestegg and Smart Property Investment. He enjoys giving Aussies practical financial tips and tricks to help grow their wealth and achieve financial independence. As a self-confessed finance nerd, Cameron enjoys chatting with industry experts and commentators to leverage their insights to grow your portfolio.

About the author

author image

Cameron is a journalist for Momentum Media's nestegg and Smart Property Investment. He enjoys giving Aussies practical financial tips and tricks to help grow their wealth and achieve financial independence. As a self-confessed finance nerd, Cameron enjoys chatting with industry experts and commentators to leverage their insights to grow your portfolio.

more on this topic

more on this topic

More articles