Philip Lowe (the governor of the Reserve Bank of Australia) has encouraged the mortgagors to refinance after he saw the rise in the number of refinancers. He said it is a big opportunity for the refinancers as the interest rates are lowest at this moment that can maximize the benefits of the customers. He also said that it is the best time to buy stuff and ask for new discounts. Here are his exact words about this situation: “I have been observing the situation of people seeking loans for a long time. And I request them all to ask for a rate that they have decided to be suitable. If the bankers are not providing that rate go to some other bank.”
Take a look at the data:
Lowe said,” as the people around Australia are living a life by maintaining the social distance, most of them are constantly looking for good deals on mortgages.”
At this moment the money flowing through the credit market is cheaper as compared to the other times. It has been made possible only because the interest rates have gone down and as a result of it a lot of Australians are attracted to such offers.
There have been refinancing works worth $15.1 billion in May alone. These refinancing tasks have been done either with the same lender or with another. Comparing this data with that of April, you will get to know that it has increased in a rate of 25%.
About 21000 Aussies who have their own homes took advantage of this offer and they have refinanced over $10 billion to external lenders in May alone. But this value has fallen by about 10% for the new owner-occupier commitments. The Governor of the Reserve Bank of Australia is pleased by such a rise in refinancing.
According to Lowe, the situation of real estate is quite stable right now but the stability of the market depends a lot on by the rate of unemployment and the availability of work for them.
Take a look at the lenders who have cut the mortgage interest rates:
After seeing this whole situation, you will notice that the interests on fixed-rate mortgage is slightly lower than the new variable-rate mortgages. Only due to this reason the number of new loans on fixed-rate has increased.
The interest rates are being cut on fixed-rate mortgages by the lenders as compared to the variable-rate mortgages. The table given below will give you more information about the lenders and how they have cut the rate of interest on fixed as well as variable-rate mortgages.
|Fixed-rate mortgages||Variable-rate mortgages||Total|
|No. of lenders who have cut rates in the month of June&July||40||42||57|
|No. of home loans with rate cut in June&July||487||260||747|
Home loan interests that are available at the lowest rate:
The bankers are offering more and more offers with a lesser rate of interest, the borrowers are the ones who are going to get the most benefits. Take a look at the offers available right now:
- Bank of Us is providing a mortgage rate that is below 2%.
- Homestar Finance is providing home loans at a fixed-rate of 2.06%.
- com.au is providing variable-length home loans at a rate of 1.99% but this rate is valid only for 12 months. After that, the rate will come back to 2.57%.
- On Freedom Lend you can get a 2.17% variable-length home loans if you deposit at least 30% of the total amount.