All those words writing in small writing on your mortgage document mean something. They have implications. It is so easy to gloss over these words. Surely, they all mean the same thing?
For your sake and the sake of your financial future you REALLY need to go over the fine print. I know, it is a lot to take in, and the fine print is jargoning bank speak that you need a degree in jargon to interpret.
Before signing on the dotted line, you want to make sure your house is in order (pun totally intended). Don’t skip the details – the devil is in the details.
The small print has info about fees and specific features of your home loan; you need to understand exactly what you’re signing up for. After all, most Aussies have a mortgage for decades. You don’t want to find yourself locked into terms that aren’t flexible enough for changing circumstances. A home loan that doesn’t allow you to renovate your home (if this is something you intend to do) or repayments that are too high to maintain will place you under unnecessary financial stress.
Your mortgage fine print
- Interest rates
Many people will only look at their interest rate. If it’s good, they’re happy, and don’t dig any deeper. It’s easy for a bank or lender to convince you that you are getting a great deal, and hide the more detailed aspects of the contract. Unless you read your documents through carefully, you may not be aware that you’re not getting as good a deal as you signed up for. Locked in rate periods are a watch out!
Look at the mortgage repayments and make sure that you can afford them. There is nothing worse than putting yourself under unnecessary financial pressure for years to come. I will also tell you if I think you are stretching yourself too far. It’s a good idea to put the current rate up by 3% and then see how you feel about the repayments.
Check the terms, and any additional features that are included. If you need an offset account, make sure that this is stated in your documents.
Go through your mortgage documents carefully to make sure what you’re getting is exactly what you’re after.
Mortgage contracts – just like any paperwork – can be dense and difficult to navigate. This is why it’s a good idea to get help. That is what I am here for and I will hold your hand and make sure you understand every decision you are making!