Your financial wellbeing guide to interest rates
The guide will help you get across how interest rates work, how you can prepare for a rate increase and how to set up a plan for your home loan.
A guide to interest rates and your home loan
With interest rates set to rise in the later half of this year....
#1. Knowing how your interest rate is calculated
Given the low deposit nature of the lending we provide, Keystart has an interest rate policy that enables us to manage our lending risk responsibly whilst remaining focused on our vision of making the dream of affordable home ownership a reality for more people.
#2. Understanding the timing for a rate change
Your Keystart home loan has a variable interest rate, meaning it could go up or down throughout the life of your loan. Understanding what is behind the timing of interest rate changes may help you prepare for a change in rates.
#3. How to plan for an interest rate increase
Paying more than your minimum payment amount can help you prepare for an increased repayment amount. You'll give yourself time to get used to a higher monthly payment, while also getting ahead in your loan.
#4. What happens if your interest rate goes up
In order for you to pay off your home loan over your loan term (for many of our customers the loan term is 30 years), you have a minimum monthly payment amount that you need to pay every month. This payment amount is based on the current interest rate. If interest rates go up, that minimum amount goes up, if the rates go down, the minimum amount goes down.
#5. Got a plan for your home loan?
Like many big decisions in life, your home loan finance needs a wellbeing check-in every now and then. You might find it helpful to track how your home loan is going and to make a plan for the next five to ten years.
#6. Considering refinancing?
We've put together tips to help you consider if you may be able to refinance to another lender. There's no rush - but as a transitional lender, we're happy for you to refinance when you are in a position to do so.
#7. Tips on comparing interest rates
If you're thinking about your Keystart interest rate, you may have looked around at other interest rates at other lenders. Interest rates can vary a lot from lender to lender, and between different home loan products. It's important to do some research so you can weigh up your options carefully.