Fix or Float - decisions around your mortgage structure

Over the life of your mortgage, the amount of interest that you pay is likely to be more than you like to imagine.

One of the ways that you can manage your interest liability is to be aware of the structure of your mortgage.

Are you getting the best value with your mortgage?

Traditionally the long term average interest rate on mortgages in New Zealand has been 8%.  For the last few years, we have had low mortgage interest rates and many people have had their mortgages on floating rates.  This means that when interest rates increase or decrease, the mortgage interest rates change in the same direction.

This has been a great strategy until now, but for may people, with interest rates increasing things need to change.

Currently around 3/4s of New Zealander's currently have their mortgage interest rates on floating or on fixed rates that are ending in the next 6 months.  Is yours?

If you fixed your mortgage in the last 12 - 18 months for a long time at under 6% - well done.  It was a good call, but for many people it was counter-intuitive, as the rates were sometimes more than the floating rate.

When interest rates start increasing - the problem is - fixed rates have already increased before the floating rates start increasing.

As interest rates increase going forward, you are likely to see higher fixed rates as well.

Now is the time to review your mortgage structure and arrangements

So, now is a great time to review your mortgage set up and get it set up for the next phase of interest rates and your financial life.

Deciding how to structure your mortgage means that we need to understand a lot about your financial situation, and ensure that we give you the most appropriate advice for your situation.

Have a look at this blog article to understand more about how we work on your behalf - and why it is useful to have us working with the lenders for you:

Mortgages – use us to get the best value for your or your family and friends

The way we do this is that we have two people that will work with you.  Carey Church is the accredited mortga

ge adviser and Paul Swarbrick is the Client Relationship Manager.  Paul works with you to gather all the information and liaises with the banks, Carey will provide you with the relevant advice, working with the information that Paul has received from you.

Depending on your situation, we may recommend that you stay with the same lender and fix various portions of your mortgage, or we many recommend that you move your mortgage to another lender, if we can get superior terms and conditions for you.

There is no charge to you for this service, we are paid by the lenders.

So, how do you get started?

Just email Carey or Paul right now, and Paul will be in touch to find out more about your situation, so that we can start the process. mortgages@moneyworks.co.nz.

If you have friends or family or colleagues that could benefit from our mortgage broking service, get them to get in touch with us too, but please get them to tell us that you referred them!

For more information on the value of fixing your mortgage - check out this article in the Sunday Star Times:

Short term gain, long term pain (Rob Stock)

If you have any thoughts or opinions that you would like to share, visit us at our Twitter, Facebook or Linked In pages, and comment.


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