Lower Interest Rates Versus Break Fees

krispedersenblogCompetition is rife amongst New Zealand home loan lenders. The promise of yet even lower interest rates in the near future is enticing the most resolute mortgage lendee to consider breaking their existing fixed rate term.

A news item on NZHerald confirms interest is high with the major banks reporting an increase in break queries. This is good business for mortgage brokers who manage would manage most of the queries.

Re-fixing can be done with the same bank or another lender.

Mortgage Brokers warn Bank’s break fees can be very high – often thousands of dollars. However the reward of a few hundred and sometimes thousands of dollars in saved interest over the existing fixed term is very alluring to homeowners with sizeable loans.

Motivation to check out your options is also spurred on when academics suggest it makes sense. Banking expert with Massey University – Associate Professor David Tripe told the NZHerald: “it made sense for homeowners who fixed a year ago when rates were going up to look to break fixed terms now interest rates were bottoming out.”

Some of the deals have been amazing too with NZHerald reporting a saving of $17,000 for one homeowner even though the break fees were a massive $13,000.

Industry acclaimed mortgage brokers – Kris Pedersen Mortgages specialise in property investment loans and with the recent announcement by RBNZ Auckland Property Investors will be wisely considering all options to get a better deal especially before October 2015.

This blog article was written for PropertyBlogs by Mobilize Mail.

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