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When the subject of interest rates comes up in conversation at this time thoughts immediately turn to how low interest rates are for residential lending and what follows is inevitably the question, admittedly an interesting one, “could they go even lower?”
I was in conversation recently with a person involved in the local body elections, standing for Mayor actually and genuinely, they suggested that the high activity around purchase of houses locally could be tied to this?
I had to oppose this notion. It’s not real. After all, how could this be when most of the people I deal with...
This is a conversation the woke among us must have with friends and family. Just because someone is willing to give the money and you want whatever you want right now, if this means paying back lending at 25% interest tell them NO! Interest rates at the other end of the scale is of far more concern to the well-being of people in our community than whether the Home Loan interest rates will fall below 3%.
Accumulating debt at high interest rates then living in a situation where you just pay the minimum repayment and just get by month to month is horrible and needs to be addressed asap for the well-being of people you care about.
Debt consolidation is the best course of action here but only if the new interest rate is lower and the repayments are sustainable with consideration to QUITTING the debt asap too! Behaviour needs to shift as well from using debt to get what you want to save for what you want.
If your friends and family want to buy a house for the first time they need to be saving anyway because many lenders expect that at least 5% of a deposit come from your personal savings. This shows financial savvy and speaks well of you as a lending risk.
So, save, and WAKE UP your friends and loved ones to interest rates that will cripple them! Have the conversation. Promote savvy over convenience.