I have 3 investment properties, about $1.2m in value and loan of $700k. The rate on the loan is 4.35% and was up as principal and interest. Is the rate too high and should we look to change the loan to interest only?
From these figures there is definitely a possibility of getting a better rate on your investment loans. Deciding if a product is suitable or whether a refinance is beneficial would require a full assessment of your situation.
Whether interest only would be a good option would depend on whether you have owner occupied debt or a legitimate reason for choosing interest only. These rates can be 0.25 to 0.80% higher than the principle and interest rate.
I would be happy to answer any further questions you may have or to review your options for you?
I can be contacted anytime on 0435.474.498 or via our website mobilelender.com.au
Based on the value of the properties & the debt, it may be possible to get an interest rate of 3.94% to 4.19% depending on your circumstances. The interest rates quoted above are for principal & interest (P&I) repayments.
Due to regulatory pressures, lenders now charge a premium for interest only (IO) loans. So, the IO rate for your loans would start at 4.34%, similar to what you are paying now.
As my colleagues have said, Interest Only Rates are nearly as high as Principal & Interest Rates these days and any change, even with the same lender wold almost certainly require a full assessment just like applying for a new loan.
If you wanted to explore your options, I'm local to you and can be contacted on 0418,547337 or my full contact details are in the "Industry experts" tab. Just click on my business name under "Name of Business" and all my contact details are there. I would be happy to provide you with some options to consider.
Bayside Finance Group