Post-Easter, after one too many chocolate eggs, many of us lament about our waistlines and our general health. No doubt regular check-ups are important, and it's often celebrations such as birthdays, Easter or Christmas that remind us to keep an eye on our general well-being.
As a home owner, what reminds you to keep an eye on the state of your mortgage? Is it the latest announcement from the Reserve Bank of Australia, your next bank statement or whenever you stumble across an article such as this?
A mortgage is no different to your home, your car or even yourself – routine maintenance and a regular health check are essential to make sure everything works effectively. If you haven't assessed your loan in the last 12 months, consider speaking to a mortgage broker. A good mortgage broker can give you an accurate assessment of your position free of charge.
One area of your home loan that has the potential to save you significant amounts of money is of course the interest rate. Many mortgage holders are still on standard variable home loans with the major banks and many of those consumers are paying an unnecessarily higher interest rate or unnecessary annual fees.
With many economists predicting small lenders will provide increased competition to the major banks in 2010, switching to a different lender could potentially save you thousands of dollars off your mortgage. Home owners can still negotiate a mortgage rate that is anything up to 0.70% lower, or even more for large loans.
If you're not looking to switch lenders, it's worthwhile making additional repayments on your loan while interest rates are still relatively low. This will prepare you for when rates rise and also create a buffer. Most economists expect the Reserve Bank to raise rates by 1% during 2010.
Sandra Crossland is a loan market mortgage broker who operates from St Ives, Sydney.