With the stability of our economy being unpredictable, particularly since the downfall of the Global Financial Crisis, it comes as some relief that Australian families will now benefit from remarkable cuts in home loan interest rates. In the past twelve months, the official interest rate issued by the Reserve Bank of Australia (RBA) has being cut by a drastic 150 basis points, helping to renew the faith of home owners Australia wide. While this news comes as a positive turn of events for many Australians, what exactly does it mean for home owners?
Basing calculations on an average Australian mortgage of $300, 000 home owners will have the opportunity to save $50 per month, with each 25 point decrease, an enormous help for many Australian families. This $50 per month saving, however, will only be received by home owners whose lenders pass on the full extent of the interest rate cut.
Many reputable financial institutions and debt solutions companies are recommending that home owners do not pocket the savings, but continue to pay off their mortgage as they are currently doing so. While this may sound like an odd piece of advice, it is calculated that those who choose to continue their regular payments could be eligible to save more than $100, 000 in interest payments and 8 years off their loan term.
If you are unsure of how the RBA interest rate cut will affect your family, it is a smart decision to talk to a debt solutions specialist. The team at Fox Symes are leading experts in the finance industry and can provide assistance in making the right decisions for your future.
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