Pro: You can probably discuss a far greater rates with an alternate lender, in the event it indicates refinancing the loan over a longer time.
Con: Your repayments increases because you will become trying to repay prominent and focus. You are going to should do significantly more documentation and you will spend bodies fees to release and you can sign in the loan.
Karl’s facts
Money spent holder Karl is with the an appeal-merely financing for 5 years having Commonwealth Bank out-of Australia, and come up with focus-just costs of about $step 1,780 a month. CBA wished your to be on a primary and you may notice loan to have 25 years, which could has actually intended making even more repayments regarding $767 thirty days. When he wasn’t able to stretch their appeal-only financing with this bank, the guy refinanced to a 30-12 months financing having St George to begin repaying your debt into their loan. Since the the guy lengthened their financing label, the guy actually shorter their costs of the approximately $212 a month, and this suited your well as he wouldn’t be able to spend a whole lot more than simply he was already using.
Read moreChoice 5: Consult with your financial regarding trying difficulty debt help
