14 Mar '18, 4am
Refinancing Your Home Loan: Why Do It and How?
Are you currently on a fixed rate home loan package? Floating rate packages generally have a higher interest rate structure and therefore you will be saving significantly if you switch to a lower interest rate package. If you already are on a long repayment tenure for your home loan, then you should definitely consider switching to a shorter loan tenure because the longer the tenure, the more interest you will be paying on your loan. Before you fall for the “attractive” interest rates offered by another bank, you need to look for any hidden costs involved. This could be documentation charges, Stamp Duty on a new mortgage deal (which some banks do not include as part of the processing fees) or any other charges that are not advertised. Add the hidden costs and then evaluate if the new offer is better. If not, you need to keep looking for one that is.