Mortgage broker says 3% mortgage still possible


James Grima

Mortgage broker James Grima says it still possible for borrowers to secure mortgage rates that start with a ‘3’. Mr Grima said that sub 4% interest rates are possible if borrowers are prepared to accept principal and interest loan repayments on their home loans.

Overtime, interest rates on home loans become uncompetitive if they are not continually reviewed and renegotiated with the lender. Borrowers should at least annually ask their bank or broker to review their interest rates to ensure they remain competitive.

“It is surprising how many clients manage their home loans like electricity bills and don’t review rates in order to save money,” said James Grima, Managing Director – Finance, Omniwealth.

Reviewing rates can save borrowers thousands of dollars each year.

“An ideal client for a lender is one that does not continually review their rates and are unknowingly paying more interest each year than is necessary.

“We review rates on behalf of clients each year. If a client’s rate is not considered to be competitive at the time of the review, we will contact the lender and renegotiate the rate. Lenders in most cases will renegotiate the rate to meet the market,” said Mr Grima.

Your rights in changing banks

Unless the mortgage agreement specifically prevents a borrower from changing banks (which none of them do) the main impediment to doing so will be commercial rather than legal.

The main factor that will need to be considered is the cost of moving banks by way of exit or other fees for the early payout of a loan. Currently, many banks will, however, cover this cost if you move over to them.

The next consideration is the fixed rate payout (i.e. the sum that will need to be paid to exit that loan and move to another bank). Once this is determined, and the borrower has agreed to move, the transfer is formalised by way of a Discharge of Mortgage.

By James Grima, Managing Director – Finance

You must be logged in to post or view comments.