Another month, another interest rate rise.
Since May 2022 we’ve had consecutive increases and if you’re feeling the pinch with your home loan repayments you’re not alone.
Whilst being in the same boat as many other homeowners doesn’t change the situation, it’s somehow comforting to know that this is a common experience.
From this shared understanding comes a conventional wisdom about how to handle the situation.
We know that interest rates cannot rise forever.
Economists vary in their predictions; however the consensus seems to be that there’ll be several more increases during the first half of 2023.
These views then see rates holding steady for the remainder of 2023, before falling slightly in 2024.
Given that interest rate decisions are out of our hands, we need to look at what we can do to handle the repayments.
Here are the short, medium, and long-term actions that will see you cope with the situation and build financial confidence.
Actions to take now
• Don’t put your head in the sand, the problem will not fix itself. Read the latest letter from your Bank, or log on to internet banking, to confirm your new repayment amount.
• Talk to your Bank about the best deal and check out the rates being offered by your bank for new customers.
Then look at a comparison site to see what the competition is offering.
Armed with this information give your bank a call and ask for the ‘Home Loan retention team’.
Let them know about the best deal you’ve spotted and ask them to match it.
Maybe they’ll match it, or maybe they’ll fall short but offer you a better deal, either way this phone call can save you thousands.
However, you may find yourself talking to a banking scrooge and they offer you nothing, then call them back in a week and ask again.
If the answer is still no, then it’s time for a new Banking relationship, because you’re worth it.