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mortgage market updates

How to protect yourself from upward interest rate movements?

Recently there has been media speculation about a ‘global economic Armageddon’ that would see large increases in home loan interest rates. On the other hand, some experts have said home loan rates will likely rise a bit in 2018 but are not expected to take a big jump up. One thing we can all agree on is interest rates move around both up, and down, and no-one has a crystal ball when it comes to predicting rate movement.

As a homeowner with a mortgage, you have no control over the external global environment that dictates at what level rates sit, but you do have control over your household budget and the way your home loan is structured.

If you are worried that your home loan might be hit by rising interest rates, there are some techniques Global Finance can employ to reduce any concern.

Global Finance is ready to help you re-structure your home loan, using a number of techniques successfully tested over the past 19 years, which has helped thousands of customers pay less interest and pay their home loans off faster.

Protect your most important asset – your income

In New Zealand:

  • 80% of households have vehicle insurance
  • 70% have home contents insurance
  • 60% have home insurance
  • Only 20% have income protection insurance

We insure our car because we want to protect ourselves if the vehicle is involved in an accident. We insure our home to protect us from fire, robbery or a natural disaster. So, we insure our cars and homes but not our incomes

Each year 54,800 households experienced an illness that meant that an individual was unable to work for 3 months or more.

Most people severely underestimate the likelihood of being off work for a long period of time caused by illness. For employed 18-64 year-old New Zealanders, the likelihood of being off work for 6 months or more is twice of that following an accident.

Most people don’t understand that WINZ or ACC may not be able to help them cover 100% of their income if an illness means they are not able to work. If a partner’s income is greater than $30,000, this will preclude them from receiving the Job Seeker allowance. Also, ACC does not cover long-term illness that prevents employment in all cases.

Many families are vulnerable if one of the earners becomes ill and is unable to work with 45% of households having only a four-week buffer to pay bills once any sick leave, annual leave and savings are taken into account.

Speak to us about how to protect your income in the event of illness.

  1. Early Romans used salt as a form of money. In fact, the word “salary” comes from sal, which means “salt” in Latin.
  2. The phrase “to pay through the nose” has its roots from the Danes in Ireland. The Danes would slit the noses of the Irish who would not pay a Danish poll tax.
  3. The word “cash” is from the ancient Chinese, who carried their coins in bundles on strings. A bundle of a hundred coins was called one cash. The Chinese probably got the word from the Portuguese who called their coins caixa, pronounced “cash-a.”
  4. All the gold discovered in the world would be a cube between 62 feet and 82 feet along each side, which would fit into a tennis court.
  5. The U.S. Secret Service was originally created on July 5, 1865, during the Civil War to fight counterfeiting, which was a huge problem. By the end of the war, between 1/3 and 1/2 of all U.S. paper currency in circulation was counterfeit.

“I have known Mr. Ajay and his team for more than 12 years. Global Financial Services was instrumental in reducing my mortgage from 30 years to just 9 years. We have used their services all these years for obtaining loans/mortgage and at no time we have been let down. In fact, there were instances when other financial institutions/mortgage advisers either failed or could not come up to our expectations, Global Financial Services have managed to exceed our expectations. I can, without any hesitation, affirm that Mr. Ajay and his team are the best in the job in Auckland.”  – Stanley. B

“Have been with Global Finance for more than 14 years and Global has always been on the mark.Always willing to assist, be it Mortgage loans, Insurance working in the interest of his customers. Their recommendations are sound and extremely non-biased giving us the best deal “covering the capital and sustaining the interest”. Highly recommended, trustworthy, honest and most reliable. Thank you, Global, Ajay and his team for all the support through the last decade. Your contribution to our financial wellbeing has been invaluable. Keep up the good work.” – Jerome. D