Fixed or Variable Home Loans -
The basic interest rate on a home loan is known as the standard variable rate. The rate is calculated using the interest rate set by the Reserve Bank of Australia, which changes according to economic criteria set by the Bank.
As the name suggests a variable rate loan may go up or down during the term of the loan. This type of loan can give you flexibility on your repayments and redraw facility. Many lenders also offer loans at a fixed interest rate. This means that your interest rate does not change for a given period of time –usually from one to five years. The certainty of a fixed rate can help with managing repayments
and budgeting in the first few years of having a home loan – its good protection against the unexpected, giving peace of mind.
As a rule of thumb, if a rise in interest rates of more than 2% would mean that you couldn’t cope, then it might be a good idea to fix at least a portion of your loan.
Usually you cannot make extra repayments or vary repayments with a fixed rate loan. These loans also carry penalties if you cancel the loan. You may however make unlimited extra repayments without penalties on a variable
Buying your First Home
It can be exciting, yet challenging. While the process can be daunting our fully accredited and licensed mortgage professionals will help you every step of the way. Firstly you should work out how much you can afford. This can be done by doing up a budget and looking at how much you are saving regularly. For most lenders, a minimum of 5% of the purchase price is required as a deposit. The deposit is required by most lenders to be genuine savings which means that you can prove
that you have either held the money consistently for a period of generally 3 to 6 months or have continuously added to your savings over that same period.
We will take the stress out of buying your first home by guiding you through obtaining the finance for your very first own home.
Buying your Next Home
Whether you’re upgrading or downsizing your home it may also be the right time to see if your current home loan is still right for you. What are your goals? Do you want to pay off your new loan as quickly as possible? Or do you need to keep your repayments down because your family is growing? Or are you building your new home and need a construction loan? Making an appointment with Simple Mortgage Solutions takes the headache out of moving and makes it simple.
Your Property Investment
That is best suited to your needs will depend on your goals. Some investors want to make money on the rising value of the investment property through capital growth. This may mean buying in an area where property values are likely to rise due to population increases, or lifestyle features like cafes and shops. Other investors focus on the rental yield of their investment. This is the rental return your property investment earns compared to its market value. Building an investment property can offer greater depreciation benefits than an older property. However, there may be good opportunities to improve the value of an older property through renovations. However, you need to be mindful that renovating takes time and money. Generally speaking, capital growth tends to be stronger for investment properties located in and around capital cities.
An investment property can also provide potential tax savings. Many of the costs of owning a rental property can be tax deductible, making your investment more affordable.
Contact Simple Mortgage Solutions to get you started as an Investor today.
The basic interest rate on a home loan is known as the standard variable rate. The rate is calculated using the interest rate set by the Reserve Bank of Australia, which changes according to economic criteria set by the Bank.
As the name suggests a variable rate loan may go up or down during the term of the loan. This type of loan can give you flexibility on your repayments and redraw facility. Many lenders also offer loans at a fixed interest rate. This means that your interest rate does not change for a given period of time –usually from one to five years. The certainty of a fixed rate can help with managing repayments
and budgeting in the first few years of having a home loan – its good protection against the unexpected, giving peace of mind.
As a rule of thumb, if a rise in interest rates of more than 2% would mean that you couldn’t cope, then it might be a good idea to fix at least a portion of your loan.
Usually you cannot make extra repayments or vary repayments with a fixed rate loan. These loans also carry penalties if you cancel the loan. You may however make unlimited extra repayments without penalties on a variable
Buying your First Home
It can be exciting, yet challenging. While the process can be daunting our fully accredited and licensed mortgage professionals will help you every step of the way. Firstly you should work out how much you can afford. This can be done by doing up a budget and looking at how much you are saving regularly. For most lenders, a minimum of 5% of the purchase price is required as a deposit. The deposit is required by most lenders to be genuine savings which means that you can prove
that you have either held the money consistently for a period of generally 3 to 6 months or have continuously added to your savings over that same period.
We will take the stress out of buying your first home by guiding you through obtaining the finance for your very first own home.
Buying your Next Home
Whether you’re upgrading or downsizing your home it may also be the right time to see if your current home loan is still right for you. What are your goals? Do you want to pay off your new loan as quickly as possible? Or do you need to keep your repayments down because your family is growing? Or are you building your new home and need a construction loan? Making an appointment with Simple Mortgage Solutions takes the headache out of moving and makes it simple.
Your Property Investment
That is best suited to your needs will depend on your goals. Some investors want to make money on the rising value of the investment property through capital growth. This may mean buying in an area where property values are likely to rise due to population increases, or lifestyle features like cafes and shops. Other investors focus on the rental yield of their investment. This is the rental return your property investment earns compared to its market value. Building an investment property can offer greater depreciation benefits than an older property. However, there may be good opportunities to improve the value of an older property through renovations. However, you need to be mindful that renovating takes time and money. Generally speaking, capital growth tends to be stronger for investment properties located in and around capital cities.
An investment property can also provide potential tax savings. Many of the costs of owning a rental property can be tax deductible, making your investment more affordable.
Contact Simple Mortgage Solutions to get you started as an Investor today.