For many Kiwi homeowners, refixing a mortgage can feel like a routine task. You choose a new interest rate, select a fixed term and move on.
However, your refix is also an opportunity to take a broader look at your mortgage and make sure it still suits your circumstances, cash
flow and future plans.
As you pay down your mortgage and the value of your property changes, you may build up equity in your home. That equity can sometimes be
used to help fund renovations, consolidate debt, invest or cover another significant expense.
One way to access it is through a home loan top-up. While this can be a cost-effective way to borrow, having equity
available does not automatically mean using it is the right move.
Here is what homeowners should consider before adding more to their mortgage.
Most of us have an everyday bank.
It’s where our salary or wages are paid, our bills come out, and our debit or credit cards are held. We may have been with the same
bank for years, so when it comes time to apply for a mortgage, it can feel natural to start there.
But does your mortgage actually have to be with the bank you use every day?
The short answer is no, not necessarily.
Most homeowners and investors set their mortgage up once and leave it there. But a home loan isn't a “set and forget” arrangement — and the
moments when your circumstances change are exactly when it pays to review it. One of the biggest of those moments is when you’re
restructuring how a property is owned: moving it into a company or a family trust. If that’s on your horizon, it’s also the ideal time to
look at whether your current bank is still the right fit.
The case for switching banks.....