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Budgeting: the great loan buster
You've probably heard it all before, but
a simple household budget should be the cornerstone of your home loan
strategy. Budgeting will allow you to save whatever is left over at the
end of each month. That money can then be put to work for you via a
mortgage offset or all-in-one account.
Treat your home loan like an
investment
Your home is an investment in the future
so treat it accordingly. Would you invest $100,000 into a 25-year fixed
asset and never monitor the market again? Monitor rates carefully and be
prepared to change lenders if necessary. Remember, reducing your interest
costs by one per cent is equivalent to a one per cent increase on your
investments.
Decide what really counts
Everyone has different needs. You may
hate the idea of monthly loan fees. Or you may think a few dollars a month
is fine – but only if you can pay extra funds into your loan and take them
out when you need them at no extra cost. You may want the option of moving
to a fixed interest rate down the track. Or you may want to buy as much
house as you can possibly afford, even if that means a low-flexibility
no-frills loan.
Consider all the lending alternatives
Twenty years ago, almost everyone got
their home loan from a bank or a building society. These days, you have
many other alternatives. Specialist home loan companies like RAMS and
Aussie Home Loans are growing ever more popular. The latest trend is firms
that can offer products from several lenders. Well over half of all US
home borrowers now get their loan this way.
Visiting someone else’s office can be an
uncomfortable experience, and takes more time than you’d want. Some firms
can send a “mobile lender” out to visit you and discuss your needs.
CLICK HERE for
your free online quote with E-Loan.
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