Deciding the best way to pay off your mortgage faster can be challenging, especially with the ever-changing advice on interest rates.

The RBA recently indicated that a rate cut is unlikely, citing that underlying inflation remains too high and will take some time to reach the target range of 2-3%. However, with global share markets experiencing significant falls in early August, there is pressure on central banks, starting with the US Fed, to make emergency cuts.

 Given the current uncertainty about rates, seeking advice from a finance specialist, like Our Broker, is crucial. Their tailored advice can ensure that your financial structures are aligned with your goals and set you up for the next five to ten years.

One option worth considering with a broker is a ‘split loan’, where a portion of your home loan is fixed, and the remainder is variable. This approach offers the best of both worlds, providing some degree of certainty whether rates go up or down while also allowing the flexibility to repay the mortgage faster or make redraws from the variable portion of the loan if money gets a bit tight. 

Moreover, you can split your loan however you want. While you can go for the standard 50:50 split, you have several options. It all depends on your individual preferences. If you prefer security but want some flexibility, you could split in favour of a fixed rate. On the other hand, if you plan to get the most out of the savings if rates fall, you may prefer having a larger portion of your mortgage as a variable rate.

 Deciding on a fixed, variable, or split loan is a significant decision that can greatly impact your future repayments and household budgeting if rates rise or fall. To help limit the impact of rising rates, for example, it’s essential to consider making extra repayments or exploring other ways to pay off your home loan faster. These are strategies that a finance specialist, such as Our Broker, can discuss with you. 

Contact Our Broker today at 1800 913 677 to explore your home loan options and create a tailored solution that meets your financial needs.