Sunday, June 30, 2013

Who has the Best Home Loan?

When home buyers make the decision to buy a home, one of the first and foremost things on their minds, save for those few fortunate enough to have saved enough to buy outright, is 'who has the best home loans'? Factors such as interest rates, lending conditions and reliability all play a major role in answering that question, but with over 50 established lending sources on the market place including banks, credit unions and finance companies, finding out can involve a lot of intensive research, meetings and questioning; certainly an exhaustive process.

To begin with, there is a great resource, courtesy of our friends at Good Returns, which provides a continually updated comparison of interest rates for all the major lenders, all in one place. It also shows a history of changes and can be filtered by type of lender (Major banks, minor banks and non bank lenders) and can also show changes from the previous day, one week, two weeks, four weeks, three months or six months. There is also a feature where graphs can be plotted showing visually a comparison between lenders with changes over time.

The latest home loan rates can be found here. In terms of interest rates, this is a great resource to use.

Obviously personal circumstances play a role in what you're looking for out of a home loan. Knowing this, simply looking at interest rates and watching television ads extolling the virtues of certain institutions can be a tad misleading, as they are generalised to appeal to a wider audience and not you specifically. Plus, some calculations can be complicated things, and it can be confusing as to which loan will really pay off for you over the entire course of your loan repayments 5 years or more down the track. Each of the major banks has their own calculator applications designed to answer these questions, but again, comparing them all and taking into account all of the minutiae can be a daunting task, for which there is no simple table or application to complete.

If you want to take some of the legwork out of your home loan research, Mortgage brokers can be a helpful resource. They can either secure a loan at the best possible conditions for you specifically or determine which loan is best based on all the factors you need taken into account. A small difference in percentile points here or some misunderstood fine print there and you could end up paying hundreds or thousands more than you could have been if you covered all your bases from the start. Auckland in particular has experienced a rapid increase in the cost of housing, making it even more vital that you don't waste money when repaying your mortgage.

Overall, we hope the resources online help, but if you require more information or think you could benefit by having your bases covered when it comes to your home loans, make a free, no obligation enquiry to our lending department anytime at enquiry@sprattfinancial.co.nz



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