Interest rates are going up, people are shopping for better deals. Lenders are giving out cashbacks to attract refinance customers. There are a few things to consider before and after you decide to refinance.
Firstly, don’t rush. Take this time as the opportunity to relook at your financial situation holistically. Consult an accountant or a tax advisor before you refinance. Get the loan structured the right way that suits your financial goals. Even you thought you got it right the first time round, this still gives you a good opportunity to review and change.
Don’t get me wrong, refinance probably is still the absolutely right decision for you right now. Who doesn’t like the bank to pay off your loan by 3k or 4k for free. However, think before you act is what I am saying.
Secondly, once you get your cashback, think carefully before you decide how to use the cashback.
To do that, let’s firstly wind back and take a look how we got here.
You refinanced because interest rate went up. Why did interest rate go up again ? Because inflation was high. Why? Coz post Covid over consumption.
That’s right, it’s over consumption got us here.
If the cashbacks are spent, the vicious cycle will continue. Inflation will continue to go up, interest rate will continue to rise, mortgage pain will get bigger.
So, mortgage holders, let’s do our bit to help to combat inflation by putting that cashback in your offset account or loan account, let’s not spend it.
As a Charter Accountant and Mortgage Broker, we are here to help each step of your way. Contact us to start the refinance discussion.
