If you had taken up a home loan during the past 2-3 years, you might be enjoying the lower interest costs for your mortgage due to the US interest rate cuts as part of a quantitative easing programme to mitigate the economic downfall caused by the pandemic.
But in May 2022, the US Federal Reserve reversed its stance and introduced rate hikes to slow down rising inflation, impacting countries worldwide, including Singapore.
Singapore’s mortgage rates have been climbing the past few weeks; in a scenario of rising homeownership costs, the topic of refinancing is even more critical.
In this article, we provide you with a one-stop guide to refinancing in 2022 and how you can get the best possible refinancing solution for yourself.
Why Do People Usually Refinance?
Typically, there are a few reasons why people would refinance their loans:
- To lower the interest rate of your loan
- To lower your monthly repayment for unanticipated situations
- To lock in your current interest rates
- To increase the monthly payment so that your loan can be paid off faster
In a nutshell, people typically refinance for two reasons; to adapt to changed circumstances or to avoid the extra costs that would arise if you do not take any action after your package ends.
What Could Stop People From Refinancing?
The simple answer is that it can get troublesome and time-consuming, which can lead to decision inertia. When doing home refinancing, you must research carefully from different sources to ensure that you’re getting the best rates possible.
You would have to go to different banks, whether offline or online, to read through their product information carefully.
There are also hidden pitfalls you have to consider such as administrative and processing fees, and factors such as how long you will keep your home before selling can affect your savings.
Suffice to say, it isn’t as simple as getting a loan with a lower interest rate, no matter how blogs and financial institutions out there phrase it.
Now, if you’re someone who isn’t able to research properly, that doesn’t mean all hopes are lost. There exist tools out there, such as the PropertyGuru Finance SmartRefi, that’ll do all the groundwork for you.
PropertyGuru Finance SmartRefi Tool
PropertyGuru Finance SmartRefi is a proprietary tool that allows you to customise your refinancing profile.
With the tool, you are able to track your mortgage against the daily market interest rates across all major banks. You can also set alerts to notify you to refinance at the optimum time for maximum savings, and check your refinancing eligibility in minutes.
Homeowners can trust that PropertyGuru Finance’s SmartRefi tool provides unbiased recommendations, as it is powered by smart technology and supported by mortgage advisors who are not motivated by earning commission from you. Compared to banks which may have a vested interest in getting more people to refinance under their institution, SmartRefi is able to provide an objective overview of the best refinancing option available in the market for you.
Due to this reason, you will be able to do a comparison of all available refinancing options to find the one most suitable for you.
How PropertyGuru Finance SmartRefi Tool Works
PropertyGuru Finance’s SmartRefi Tool helps you solve your refinancing issues with these simple steps.
Firstly, head down to the PropertyGuru Finance SmartRefi website. On the website, select your refinancing goals from the 3 options: lower monthly repayment, be debt free as soon as possible and get cash for major expenses.
Next enter the location, property type, purpose of property, value and check whether this unit has been refinanced or not.
Afterwards, select your lender, interest rates, lock-in period, remaining loan amount, remaining loan tenure and loan start date.
Once that is all filled in, you will see a dashboard. On the dashboard, the first thing you will see is their advice, on whether to refinance now or later and explanations on what is the cost or savings of refinancing now.
Below that, you will see your savings potential and a breakdown of the cost to be incurred from refinancing.
With this tool, you can also set alerts to notify you when it is the optimal time to refinance your loans. SmartRefi will simply give you an alert when it is optimal to refinance.
Conclusion
No matter whether you’re on a floating-rate mortgage loan, your fixed-rate period is coming to an end, or you have to refinance or run the risk of your loan getting more costly, PropertyGuru Finance SmartRefi might just be the tool you need right now.
With PropertyGuru Finance SmartRefi, you will be able to keep up to date with refinancing opportunities and maximise your savings no matter the situation you’re in.
Even if you’re currently happy with your home loan, there is no harm in signing up. Mortgage rates change so often, so if you sign up for SmartRefi, you’ll be alerted as soon as there is a package that is better than your existing mortgage. It’s free anyway.
If you wish to know more about SmartRefi, click here to try it out.
This article was written in collaboration with PropertyGuru. While we are sponsored by them, we still review products and services with an objective lens and stay true to our mission–providing you with the best recommendations and advice to make smarter financial decisions.
The article Refinance Your Mortgage Loan Today to Save Better Tomorrow originally appeared on ValueChampion.