Get down low and go go go. You might remember this slogan from a series of fire safety adds but this is also a good way to treat your mortgage. Get your fees and interest rates low and make additional payments as often as you can. Record low interest rates offer us a unique opportunity to reduce our debts. We should not squander this moment in time.
Remember, only 4 short years ago, the long term average interest rate was 7.00% p.a.. Today, variable interest rates sit at approximately 4.00% p.a..
A $500,000 mortgage at 7.00% p.a. has a minimum monthly repayment of $3,326.51 over 30 years. This same loan at 4.00% p.a. would have a minimum monthly repayment of $2,387. The 3% difference equates to a monthly repayment saving of $939. If we make the higher repayment of $3,326.51 on the lower interest rate of 4.00%p.a., the loan would be fully paid off in 17 years and 5 months.
As you can see, with rates this low you have a golden opportunity to reduce debt. We are here to help you with the “Get down Low” part of the slogan.
Far too many people are making additional repayments that are swallowed up by high rates and fees.
It’s time for a free health check call or email us today.