Landlords have been enjoying rock-bottom interest rates on investment property loans for years and they don’t look like going up any time soon.
But that’s no reason to assume you’re getting the best deal out there. Some banks have been reducing variable rates recently as they compete with each other to win more business.
So it’s important to refinance your investment loan regularly, to make sure you’ve got the best rates available and the features that suit your investment strategy.
A small rate reduction can mean big savings over a loan term of more than 20 years when compound interest is taken into account. And if you’re paying interest only, a better deal means less money paid to the bank and more chance of a positively geared portfolio.
Refinancing could also unlock some equity you didn’t know you had, which could be put towards your next investment.