If you have a home loan or an investment loan, it’s most likely your biggest monthly expense. That is what makes this possibly the most important message you’ll ever read. Why? Because, odds are, you’re paying way too much.
Always having the lowest cost home loan for your situation is critical, as a home loan is both a major financial decision and perhaps one of the most significant decisions of your life.
Get this right, and you can set yourself up for financial security and a comfortable lifestyle for years to come.
Get this wrong (as most people unfortunately do) and you could be:
- Paying a HUGE amount in extra interest to the Banks (for example, overpaying more than $201,103 in interest on a $450,000 loan over 30 years at 6%pa interest compared to the same loan at 5%).
- Taking the full 30 years to pay off your loan (many people never fully pay off their home loan over their lifetime).
- Being unable to properly invest for your future and becoming part of the 80% of Australians who end up on some form of government assistance in retirement (with access to retirement benefits being delayed to 70 years of age).
You can see why it’s important to realize that all home loans are not the same. Example:
When we recently compared the true cost of 383 variable home loans offered by 104 different lenders on a $450,000 home loan, the difference between the 10 least expensive loans and the 10 most expensive loans was an incredible $599.50 every single month.
If you paid that $599.50 as extra repayments into the loan, you would save a massive $211,833 and cut over 10 years off your home loan.
That’s a lot of money.
Keep in mind, these are the loans that lenders are paying to advertise. This means that these are their best loans, discount packages, and special offers!
While you might be confident that your interest rate is not one of the more expensive ones, the difference between the cheapest loans and just the average loan was still $319.73 per month. This means that the average Australian home owner can pocket an extra $319.73 every month (or homeowners could use that money as extra repayments, saving as much as $142,987 and being mortgage free 7 years earlier).
Ready to make sure you’re getting the best rates on your home loan? For information on where to begin, call us on 1 800 3 PEASY.