How to get the most out of your home loan

SMART BORROWING: It makes the most financial sense to use your existing home loan to access the money you need for things such as renovations or a new car, as unsecured personal loans can have much higher interest rates.

SMART BORROWING: It makes the most financial sense to use your existing home loan to access the money you need for things such as renovations or a new car, as unsecured personal loans can have much higher interest rates.

From Stuff.co.nz:

Home renovations can be a daunting proposition, but accessing money for improvements around your property is usually a far less stressful task.

Vince Clark, head of home lending and deposits at ASB, says there are a variety of different ways homeowners can obtain funds for their renovation plans, with personal loans and home loan top­-ups just some of the options available.

Because higher interest rates usually apply to unsecured forms of borrowing such as personal loans, Clark says it makes the most financial sense to use your existing home loan to access the money you need.

“A home loan is likely to be the most affordable borrowing a customer will ever have. With home loans, interest rates currently range from around 6% p.a. to 7.5% p.a, whilst unsecured lending can start from 17.95% p.a. or more. That’s a huge difference.”

Clark advises would-­be renovators to do their homework by adopting a “common sense approach” to getting the renovation they want at the cost they expect, so there are no last-minute surprises.
Getting a variety of quotes and using reputable tradespeople is the first step to avoid a renovation nightmare. This will also provide an accurate gauge to determine how much money you will need to borrow, which is an important part of your conversation with the bank.

Obtaining finance for your renovations should be the easy part, Clark says. Look for a lender that makes this process as painless as possible. Ensuring you get the renovation you want with no surprises from builders and other tradespeople should be the main focus.

Top tips

  • Do your homework when considering major renovations – the finance part should be the easy bit.
  • Talk to your bank about what options are available to you. Can you get a top up on your home loan?
  • Remember your home loan is likely to be the cheapest form of borrowing you have.
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About Peter Griffioen

Peter Griffioen - or simply Griff to those who know him - has an established reputation as a high-producing Harcourts Canterbury salesperson. With a focused approach to customer service you can rest assured that you are in good hands, whether it be a relaxed chat about the state of the market or an in-depth discussion regarding your next property transaction. The key advantage of engaging Team Griff’s services is their local knowledge and experience. Currently in this post-seismic era, it is vital to have true professionals working on your behalf, ensuring that you are guided through the process professionally and with a caring approach. The advent of the ‘as is, where is’ market means specialised expertise are required and Team Griff has taken it on themselves to both understand and explain the pros and cons of this now accepted sale/purchase option. For over 26 years the Griff brand has become synonymous with achieving results. Griff now prides himself with his five member team and takes much satisfaction from empowering them to both achieve and reach their own goals. A team with a proven track record placed with the highest ranking Harcourts Million Dollar Club members, exceeding the $275m level. Such accomplishments highlight the team’s exceptional marketing and negotiating skills. Team Griff are recognised as industry leaders for their online presence and regular blog posts of current and relevant real estate information. E-marketing and readily available property specific detailed info means Team Griff’s clients have the edge when it comes to selling their homes, not forgetting purchasers who benefit first hand. A simple Google search says it all – the Griff brand ranking with the most frequent. Griff’s life focus extends beyond business, with quality time and fun being high priorities, while mountain biking, boating and fishing provide that vital time out. His Christian faith is his anchor for daily living, and his community is important to him. For a team approach to optimize the result for your next property transaction, be sure to talk to this award winning team - synonymous with hard work and results! Griff and his trusted team welcome your enquiry today.

One thought on “How to get the most out of your home loan

  1. Halifax homes for sale

    Hey Griff , nice blog and the tips are useful for me and home loan so stressful for the buyer but remembering the points they easily handle the loans and the situation and Keep posting.

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