Where to Get the Best Deals on Home and Auto Loans Right Now

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The Reserve Bank of Australia (RBA) once again left the spot rate at an all-time low of 0.10% this week, as a growing number of lenders start to raise fixed mortgage rates to 4. years.

And investors have started to lead the charge for new home loans. The value of new loans to investors is rising as homeowners begin to pull out of an increasingly unaffordable housing market.

Meanwhile, the used car market has really heated up thanks to the limited supply of new vehicles, with Australians questioning whether it is more affordable to buy a used vehicle, or just wait. a new model.

Let’s take a closer look at how interest rates have changed or are expected to move for May 2021.

To Repair or Not to Repair

While RBA Governor Philip Lowe continues to assert that interest rates are unlikely to rise until 2024 at the earliest, several lenders have increased their 4-year fixed mortgage rates.

RateCity’s research shows that there are only six 4-year fixed rates below 2% in its database, up from 32 at the start of the year. No fixed 5-year rate is currently less than 2%.

But it appears that shorter-term fixed rate options still retain a competitive advantage, with the number of 2-year fixed rates below 2% doubling to 71 year-to-date. The number of 3-year fixed rates also nearly doubled to 49 during the same period.

If you’re a first-time buyer or refinancer and considering a fixed mortgage rate, it may be worth considering. Factor in a potential rate hike of at least 2-3% in your budget before locking in a fixed mortgage rate.

The lowest fixed mortgage rates on the RateCity database

Source: RateCity.com.au. Lowest owner-occupant mortgage rates, data exact as of 05.05.2021.

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Investors beat homeowners

As the housing market continues to warm up across the country – particularly in Sydney and Melbourne – we may start to see homeowner demand receding.

The latest CoreLogic National Home Value Index figures for April show home values ​​rose 1.8 percent last month. Home values ​​have grown 6.8% nationwide in the past three months and 10.2% above the Covid low seen in September 2020.

As prices continue to rise, first-time home buyers may begin to feel left out of the market, causing investors to re-enter the market. And the latest Australian Bureau of Statistics (ABS) loan indicators for March could show it.

ABS loan figures released yesterday show that the value of new loans to investors rose 12.7%, or $ 878 million, month on month in March (according to seasonally adjusted data). In comparison, loans to first-time homeowners fell 3.1% month-on-month.

For the growing number of investors, there are competitive interest rates if they’re willing to shop around, with a number of home loans offering investors rates below 2%.

Investors’ Lowest Home Loan Rates on RateCity Database

Source: RateCity.com.au. Lowest investor mortgage rate, data exact as of 05.05.2021.

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Bonus points for credit cards

The RBA cash rate has historically done very little to move credit card interest rates, and May was no exception. Australian card users expect the average credit card rate to be between 16% and 17%.

But new customer value can always be found through credit card bonus points during registration. There’s a lot to consider when purchasing a new card, including interest rates and fees, but enrollment reward points can be an attractive perk for some customers.

Keep in mind that cardholders will need to meet strict eligibility criteria to be eligible for these credit cards, as bonus points may have minimum spending requirements to be eligible.

Highest Credit Card Signup Bonuses on RateCity Database

Source: RateCity.com.au. Data correct as of 05.05.2021.

Some of the most competitive credit card signup bonuses on the RateCity database

Restricted Australians turn to used vehicles

Used vehicles have seen a resurgence in recent months, in part thanks to travel restrictions and the limited supply of new vehicles around the world.

The latest Datium Insights-Moody’s Analytics price index for March showed wholesale used vehicle prices rose 5% in the first quarter of the year, with current prices now 37% above a record high. ‘before the pandemic established in February 2020.

Growth for March was the smallest quarterly increase in the past four quarters. However, this is still faster quarterly growth than previous figures recorded by Insights-Moody’s Analytics over the past decade.

If you are considering purchasing a used vehicle, it is important to keep in mind that interest rates tend to be more competitive for financing newer vehicles. Generally speaking, this may be because used cars have more wear and tear than new cars and are less likely to last the time of a car loan.

That being said, here are some of the most competitive used car loans for you to get behind the wheel today.

Lowest Used Car Loans on RateCity Database

Source: RateCity.com.au. Data correct as of 05.05.2021.

Some of the Lowest Used Car Loans on the RateCity Database

Source: RateCity.com.au. Note: Based on a used car loan of $ 30,000 over 5 years. Data correct as of 05.05.2021.


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