The Reserve Bank has today cut the cash rate by 25 basis points, bringing the official interest rate to a record low of 2.25% and laying the foundations for some of the cheapest home, equipment and commercial finance in over forty years.
It’s a decision that has surprised many economists and industry insiders with most expecting the cash rate to remain on hold, at least for February.
The previous record low of 2.5% was held for 15 consecutive months.
A declining Aussie dollar coupled with reduced consumer sentiment impacted the move, as no doubt did political instability amidst simmering leadership speculation.
Whilst this reduction is good news for mortgage holders and new entrants to the property market, there is one sure thing when it comes to low interest rates, they will go up at some stage (and you can bet it will be a faster escalation).
To get the most ‘bang for your buck’ NOW is the time to make low rates work harder for you by paying down debt, reducing your loan term and saving money.
If you are looking to improve your lending situation, secure additional finance for home or business or reduce your monthly repayments, now is the time to negotiate. Banks want your business and they’ll work harder to get it. You’ve just got to know which bank or lender to ask.
In addition to low rates your Green Finance Group Finance Consultant has access to additional benefits not always available in the broader marketplace, including access to lower (or even no) lenders mortgage insurance, even if you are borrowing up to 90% of the property value.
If you’d like to know if you could get a better deal on your home, equipment or business finance just ask us. Call 07 3899 2866 for a no-obligation finance review.
The next RBA board meeting will be held on Tuesday 3 March, 2015.