If you’ve checked property news over the past month, there’s a high chance you’ll have encountered stories about cash rate changes. Everyone’s talking about it, and while the Reserve Bank of Australia has held rates where they’ve been for almost three years, a change is finally on the horizon.
Today at 2.30pm, the Reserve Bank of Australia (RBA) cut official interest rates to 1.25%. This means a home loan rate of, say, 4.30 per cent has dropped back to 4.05 per cent. Depending on the amount owed, the savings are likely to be noticed, such as with a repayment on $500,000 resulting in closer to $73 monthly saved.
However, there’s a catch: even though the RBA has made these changes, you’ll still have to wait for your bank to pass the savings on.
Alternatively, you can start looking for a new lender, because there’s already movement in the industry ahead of today’s changes, as institutions start trimming and cutting where they can.
Lenders such as NAB, Bank of Queensland, and Greater Bank are making some pretty notable movements on fixed rates, the latter of which can be found offering fixed rates below the 3 per cent mark, chiming in at 2.99 per cent.
Not everyone is getting in early, with others instead choosing to wait. Nevertheless, the choices for refinancing are looking better than ever, and will put the savings firmly in your pocket, whether or not Lowe and co say yes to a change, or just continue to hold.