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2023 was a year of unanticipated challenges for homeowners in Australia, with rising interest rates significantly impacting mortgage repayments. It’s understandable if you found yourself grappling with these changes and wishing for a more manageable way forward. As we step into 2024, it’s time to take control, welcome financial stability, and set a path for a future free from the stress of mortgage worries. Let’s take a look at five fundamentals that will enable you to better manage your home loan this year.
1. Create a Budget and Stick to It
We’ve all heard it before, but one of the first steps to getting on top of your home loan is to create a budget.
Start by tracking your expenses and income to determine how much you can afford to allocate towards your loan repayments. Be realistic and consider your lifestyle choices. Cutting down on unnecessary expenses and prioritising your loan repayments will go a long way in managing your finances effectively.
A budget really is an important part of managing your finances in the short and long term. Think you might like help with your budgeting? Check out some helpful hints here.
2. Shop Around for the Best Interest Rates
Interest rates can have a significant impact on your overall repayment amount. Take the time to compare different lenders and their interest rates. Don’t settle for the first offer that comes your way and don’t be afraid to refinance. Look for competitive rates that suit your financial goals and save you money in the long run.
Remember, even a small difference in interest rates can result in substantial savings over the life of your loan.
3. Consider Making Extra Repayments
Paying just the minimum required amount each month may seem convenient, but it might not be the most efficient way to pay off your loan.
Consider making extra repayments whenever possible. Even small additional payments can help reduce your principal amount and shorten the term of your loan. Click here for our extra repayments calculator.
This strategy can potentially save you thousands of dollars in interest payments and help you become mortgage-free sooner. If your loan penalises you for making extra payments, consider refinancing.
4. Keep an Eye on Market Trends
Staying informed about market trends and changes in interest rates is crucial if you’re trying to get on top of your loan.
Keep an eye on financial news, consult experts, and stay updated with industry publications such as PropTrack or CoreLogic.
Or you can tune into Property Insights each week on the Y Home Loans app…just saying.
By understanding market fluctuations, you can make informed decisions about refinancing or adjusting your loan structure to take advantage of favourable conditions.
5. Seek Professional Advice
Navigating the world of home loans can be daunting, especially if you’re a first-time buyer or investor.
Seeking professional advice from mortgage brokers or financial advisors can provide you with valuable insights and help you make informed decisions. These professionals have the knowledge and experience to guide you through the process and ensure that you’re on the right track towards achieving your homeownership goals.
If you’re uncertain about how to work with such professionals check out here for some ideas.
Getting on Top of your Home Loan
Getting on top of your home loan can take effort – it requires careful planning, budgeting, and finding the time to stay informed. It definitely involves some work, but you deserve to make 2024 the year you get on top of that home loan!
By following these five fundamentals you’ll be well on your way.
Remember, it’s never too early to start taking control of your finances. Start today, and pave the way towards a brighter future!
