Reserve Bank of New Zealand – OCR update28th January 2016: Today, Reserve Bank of New Zealand (RBNZ) announced that Official Cash Rate (OCR) will remain the same at 2.5%. In 2015, RBNZ announced 4 consecutive OCR cuts – this is the third time that OCR was left unchanged after a drop. In a similar trend, the media reported that it is expected to be cut later in the year.
In his statement, RBNZ Governor Graeme Wheeler said that economic growth is expected to increase in 2016 as a result of continued strong net immigration, tourism, a solid pipeline of construction activity, and the lift in business and consumer confidence.
He added that house price inflation in Auckland remains a financial stability risk. There are signs that the rate of increase may be moderating, but it is too early to tell. House price pressures have been building in some other regions.
Is it time to break your fixed rate mortgage to save interest?Home owners who want to take advantage of the fall on their fixed home loan or mortgage interest rates, will have to keep a few things in mind before taking a decision. Firstly, will fixed home loan interest rates fall or not; and until when will they keep falling? Secondly, what is the break cost on their existing fixed interest rate home loan?
The two biggest factors that make the difference to break cost are:
1. How much of your fixed loan term is remaining? The longer it is the higher the break cost.
2. The difference between your fixed interest rate and the new interest rate. The higher the difference, the higher the break cost.
We can help you calculate your savings versus break cost and whether it is feasible to break your loan. We are based out of Auckland and are NZ’s top mortgage broker and adviser because we have always try to save the interest cost on the home loans of our clients.
Secondly, our focus is on being proactive and providing the best customer service.
To check if you can save interest by breaking your fixed home loan, please contact Global Financial Services on 09 255 5500.