Saving on interest

[Rosco]

[essence]

Hi Ross

Thank you for posting the video. Good information.

[Rosco]

Thanks for the feedback. I'm still amazed at the number of investors, business owners and home owners who haven't tried to get better interest rates.

Ross

[essence]

I'm always surprised at my relatives who own their own homes, no investments, yet don't know a) the interest rate they're on b) the term c) that they can negotiate!!

My sister casually mentioned that she had a mortgage coming off a fixed rate (yay, she knew that much!) and she was complaining that she was on a rural rate (small farm). I just said negotiate with your Bank.

You would've thought I'd mentioned something dirty by the look on her face!! So then, I suggested she shop around various Banks and see what she could get.

I forgot about it and thought she'd sort it out. A week later she rang me all excited, she'd talked to her Bank with her information re other Banks rates, terms etc and they'd immediately amalgamated a couple of loans, dropped her from rural lending to residential and gave her a discount.

Her %age rate dropped by 2.5%!! I kid you not. A "saving" of almost $170 per payment. She knew enough to keep the payments the same, so it would shorten the term.

She's not interested in being an investor, she just wants her own home with no mortgage. She's almost there.


You example was about interest-rate averaging. Most people have never heard of it and don't know how to use it or implement it.

[Rosco]

Apparently there are lots of investors with Westpac paying 6.24% floating too. So looking at fixed options compared to this rate can give good interest savings.

I like the 1/3, 1/3 and 1/3 approach to mortgages as it protects you. Old saying don't put all your eggs in one basket.

With 5 year rates under 6%, there is a good opportunity to at least get part of your mortgages fixed in long term!

Ross

[Rosco]

Just a reminder that we do have two great seminars in Hamilton on Thursday 25th and Wednesday 31st of October, about saving interest, reducing tax and other tips and tricks to improve your rental performance. http://www.cswaikato.co.nz/seminars/

Ross