Call to ac­tion

Monthly Chronicle - - Business & Personal Finance -

Bor­row­ers on in­ter­est only need to check with their lender and con­firm how long they have be­fore the loan is re­verted back to prin­ci­pal and in­ter­est in or­der to al­low for the dif­fer­ence in pay­ments. For an in­vest­ment loan, if your bank re­fuses to ex­tend the in­ter­est only pe­riod, other banks may be able to ac­cept in­ter­est only for a fur­ther five years, how­ever you as a bor­rower need to be very mind­ful that whilst on in­ter­est only, you are not re­duc­ing any of the debt and will need another exit strat­egy.

With banks con­tin­u­ing to tighten their lending cri­te­ria, try­ing to re­fi­nance could also pose a po­ten­tial is­sue. So look­ing at your op­tions sooner rather than later could save po­ten­tial fu­ture cash flow prob­lems.

If your mort­gage provider does not help with your re­quire­ments, get in touch with your lo­cal mort­gage pro­fes­sional who has ac­cess to a suite of len­ders to see what other op­tions you may have.

Raj Lad­her from To­mor­row Fi­nance is a mort­gage ex­pert with over 11 years' ex­pe­ri­ence both in the UK and Aus­tralian mort­gage mar­kets. Ac­cred­ited with the Mort­gage and Fi­nance As­so­ci­a­tion of Aus­tralia (MFAA) and ac­cess to nu­mer­ous len­ders, Raj spe­cialises in all types of mort­gages, from first home­own­ers to in­vestors in­creas­ing their port­fo­lio. For more, email raj@ to­mor­row­fi­nance.com. au

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