With such interest rate competition in the market these days, it can become quite obscure for borrowers as to whether they have found a genuinely good deal. Here are some things to watch out for.
Arranging Finances
Positive and negative gearing 101
When you borrow money to invest in property, you may find that you are “negatively geared”. A negatively geared property is one in which the costs of owning an investment property, such as interest on a loan, council rates, water-supply charges, strata fees (for strata-titled properties) and maintenance, are more than the income or rent you receive from the property.
Make the most of your home equity
Some homeowners think they can capitalise on their home equity only if they sell their home or take out a reverse mortgage on it when they reach the age of 65. In fact, refinancing their home loan for a ‘line of credit’ facility could immediately give them access to the equity in their home and without having to sell it. (Visit Domain’s mortgage centre for a free home-loan report.)