Interested in interest rates?

December is traditionally a happy time for most people but today could see us with another interest rate hike. This could severely bite into your cash flow and hamper your Christmas spirit. A means of decreasing your monthly costs is to get better rates of interest, especially if you have a bond. This can be done by remortgaging your existing bond.

Remortgage is the process of taking your mortgage back out to the 'market' to get banks (including your existing bank) to re-compete for your business. This may be to get a better rate of interest, more money, or a new product. Your existing mortgage will have been offered to you based on your financial situation when you applied for a mortgage to buy your property. If it was some time ago your situation is in all likelihood completely different now.

For example your salary may have increased; or your house price has probably doubled. All of which means that you are a better risk to the lender, and hence deserve a better rate.

The table below shows the effect of a 1% saving in bond interest rates:

There is no such thing as a job for life anymore, so why should there be a mortgage for life! It is essential that you do a financial health check every couple of years and not only review your current mortgage but also all financial objectives that you have set up for yourself regarding your investment, life assurance, retirement plans etc. You will be amazed at how much money you can save.

It is vitally important to get expert advice when considering the financial feasibility of re-mortgaging a property; not least of which is to ensure compliance with the National Credit Act.

We have an association with highly-recommended, professional bond originators who will investigate a suitable solution for you – so give us a call to investigate the options available to you.

Silke Financial Services has the skill, expertise and wisdom to advise clients on investments and risk planning according to your particular financial situation.

If you have any queries regarding the above commentary please contact us on 021 683 3380 or info@silke.co.za.