I feel like I've been on a personal crusade lately to tidy up bad loan structures.  It's so common and yet so easy to make a difference and save someone hundreds of dollars a year, if not more.

So how does this happen?

Us Kiwis are a laid back bunch.  Stats show that the most common thing to do when taking out a new home loan is to simply fix it for 2 years and forget about it.  That might be ok at the start as it gets you in to a house and gets you settled.

But what about after those two years?

Standard practice is that the bank will send you a letter, or perhaps a phone call from one of their staff, outlining their current interest rates and more or less suggesting you do the same again.

Don't do it!

This "set and forget" approach to your structure can cost you a lot in the long run.  Some key questions you should be asking yourself are...

1. Have I had a payrise, could I use some of this to increase my payments?
2. Do I have other loans/credit cards with high interest that I could save on by lumping them with my Mortgage?
3. Am I getting bonuses that I could pay as lump sums to my Mortgage if I changed my structure to allow this?
4. What changes have I got coming up in the next few years - Is my structure able to handle these? 

Or even simpler, get in touch with us when your next fixed rate is about to expire and we'll give you a "Home Loan Health Check" on the above points and more.  We'll then negotiate interest rates with your own bank or recommend another and provide you with a structure that's going to be the best fit for you in the long term.

For example if you have a $400K loan on a 30 year loan term.  If you get a $4000 payrise since you've taken out your mortgage and increase your payments by $25/wk then you'll save 3 years off your mortgage and a total of about $50,000 in interest.

It's super easy to do, take a break from that laid back approach to your mortgage and click the "contact us" tab at the top of this page or send an email to office@mymortgage.co.nz and we'll give you simple and easy advice to get ahead.

We look forward to talking to you and putting some simple steps in place to save you money.

Adam, Claire and the My Mortgage team