Newspaper article Sunshine Coast Daily (Maroochydore, Australia)

How to Ride the Rate Rises Pay More to Save More on Your Mortgage; Financial Advisors Show Why You Should Hang on to Your Home

Newspaper article Sunshine Coast Daily (Maroochydore, Australia)

How to Ride the Rate Rises Pay More to Save More on Your Mortgage; Financial Advisors Show Why You Should Hang on to Your Home

Article excerpt

Byline: Kathy Sundstrom Kathy.Sundstrom@scnews.com.au

HOW much more pain can Sunshine Coast homeowners take?

With the Reserve Bank upping interest rates for the sixth time in less than a year, Sunshine Coast rates and levies going up and the cost of electricity and water increasing, it's hardly surprising that homeowners are the ones feeling down.

But prominent financial advisor Noel Whittaker, of WhittakerMcNaught, has advised homeowners to hang in there.

"Do everything you can to avoid losing your home," he said.

"It will cost you at least $40,000 to sell, rent and then re-buy in the future. That's a lot of interest.

"Can you find more money by cutting back on non-essential items or by one or more of the family members getting a second job?

"An extraA $100 a week coming into the household could make a huge difference."

Now might also be a good time to ask the boss for a raise.

"Australia is suffering a major jobs crisis so don't be frightened to ask for a raise in salary if you believe you are underpaid," Mr Whittaker suggested.

Refinancing your home loan is another option.

Mr Whittaker suggested looking at www.ratecity.com.au for the best home loan rates. However, this came with a word of caution: "Just make sure the costs of refinancing don't outweigh the savings in interest," he said.

"Also make sure you understand the penalties that may be involved if you wish to pay out a fixed rate loan early."

Marcoola's Bendigo Community Bank manager Judy Davis also suggested considering the option of fixing the loan rate.

"In a rising interest rate market a fixed interest rate home loan will offer the borrower a known fact a the interest rate and the fixed rate period of time," Ms Davis said.

"In Australia typically, fixed interest rate terms are between one and five years, and the features of fixed rate loans offered by financial institutions can vary.

"If you are considering a Fixed Interest Rate, ask your lender to explain the features so you know what you can and can't do.

"Some will offer ability to pay extra, some will have redraw of any extra payments, some will only allow you to pay minimum monthly repayments. …

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