What it means to put your mortgage on hold

“Should I put my mortgage on hold?”

We have been getting this question a lot. 

If you do not have the means of making your next mortgage repayment, my answer would be yes. 

However, if the business has only slowed slightly and you have money, either in redraw or offset then it’s probably not going to be in your best interest to put your mortgage on hold. In this case, I would strongly suggest otherwise.

Remember you are saving interest for 6 months right now, but you will be paying for it 2 -3 years into the future.

Here is a calculator that will show you the real implications of putting your mortgage on hold.

Give it a go and see what you think. The answer might be quite a surprise! 

If you don’t put a hold on your mortgage, what other options have you got?  

Firstly have you considered refinancing?

There’s a small window of opportunity now to refinance under relatively favourable conditions. 

1. Valuations holding up.

Here at Sandcastle Finance, we have been doing a lot of upfront valuations for clients to see whether they can access the equity in their owner-occupied property.  

It’s handy to be able to have this money ready for when the market recovers.

We are finding that bank valuations are still holding and if anything have increased. We do not know how long this will continue. If you are thinking about accessing equity we can organise an immediate valuation for you to see what is possible.

2. No significant dip in prices

Many vendors who do not necessarily need to sell their property take them off the market hoping that when life resumes, so will the real estate market. 

On the other hand, some properties need to sell. With interest rates the lowest they have ever been, money is cheap and there are the advantage of this market. 

With the continued lack of supply on the Northern Beaches house prices have seemingly defied all predictions of a severe downturn.

3. Cash rebates

There are some great rebates still out there to incentivise consumers to switch and take advantage of these amazing fixed rates as low as 2.19%. Cash backs are generally between $2000 per property or a straight $4000 refinance rebate depending on the bank. 

Switching and refinancing have always been a viable strategy to manage cash flow. You may have been paying principal and interest but it may be better, especially now, to look at interest only while cash flow may be a little tight at this time.

Let’s find out what’s possible for you. 

Before you put a hold on your mortgage payments, let’s chat. Click to book a time that suits you.