Do You Know Your Interest Rate?

​Interest rates are a crucial factor in determining your loan repayments and the total cost over its lifetime. Staying informed about your current rate and keeping an eye on market trends is essential for managing your finances effectively.

By monitoring interest rates, borrowers can make informed decisions—whether it's securing a first-time home loan or refinancing for a better deal. However, it's always wise to consult with your broker before making any changes.

Interest rate percentages are influenced by several factors: the Reserve Bank, the cost of borrowing in overseas markets, and the general state of the economy. While rate changes may seem small, even a fraction of a percent (a few basis points) can significantly impact the total cost of your loan and your ability to pay it off faster.

When you take out a home loan, you’ll need to choose between a fixed or variable interest rate:

• Fixed Rate: This stays the same over a set period, offering predictable payments every cycle.
• Variable Rate: This fluctuates with market conditions, meaning your payments may increase or decrease depending on the rate movement.

Interest rate calculators are a valuable tool for comparing fixed and variable loans. They can help you see how rates affect your monthly repayments, the length of your loan, and the overall cost.

The best way to stay ahead of interest rate changes is to maintain regular contact with your finance broker. They can help you shop around for better refinancing options when the time is right, or even assist in negotiating with your current lender for more favourable terms.

​Get in touch with Kerry at KLM finance, your trusted mortgage advisor. With extensive experience and in-depth knowledge of the mortgage market, Kerry is dedicated to helping you navigate the home loan application process with confidence and ease.