Strategies In A Low Interest Rate Environment

July 16, 2009 - PRLog -- For new and existing property investors, here are some tips to maximise the benefits of low interest rates on your loans:

Do not be too hasty to fix
Despite the interest rate reductions, there is still a considerable gap between the variable and fixed rates on offer. Discounted variable interest rates are still well below fixed rates, with many economists expecting further rate reductions this year.

Look for a home loan that offers flexibility
Once rates do bottom out (which is very difficult to pick) you may want to be able to switch to a low fixed rate, or perhaps split your loan into fixed and variable. Make sure your loans provide the flexibility to switch in the future at a reasonable cost.

Ensure you have access to any extra repayments
While interest rates are so low, many people will take the opportunity to pay extra off their home loan or investment loan, by keeping their repayments at the higher level. This can be a great strategy, but make sure you can access these extra repayments in the future, just in case. This access is typically via an offset account or redraw facility.

Consider mortgage protection insurance
This is the insurance that ensures that you, as the borrower, can continue to make your loan repayments should you lose your job or become seriously ill and unable to work and subsidise the rent earned to make your loan repayments.

Seek advice from experts
Home and investment loans are major financial decisions, and there is a massive range of options out there, so talking to an expert adviser that you trust can be very important.

These tips provided by Jayson Billings, Smartline Operations Manager. For more information or to talk to a Smartline Adviser, call 1800 020 066. http://www.smartline.com.au

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About Smartline: Established in 1999, Smartline is an Australian-owned finance broking company which operates through independent franchise owners throughout Australia.Our vision is to set the benchmark in Australian mortgage broking for client care. All Smartline Mortgage Advisers are fully qualified and trained mortgage broking professionals who “live and breathe” home loans. They’ve joined Smartline because they are people who are motivated by getting great outcomes for their clients, every time. Stringent standards ensure that the loan application is hassle free. It works.

Smartline is the proud winner of two of the industry’s most prestigious awards for best mortgage broking group, the Mortgage and Finance Industry Awards 2007 and the Australian Mortgage Awards 2006. They were finalist in 2008 and 2009.

Smartline's Managing Director is Chris Acret; its Executive Director is Joe Sirianni.