Home loans during a pandemic
During these unprecedented times it may sound strange to be thinking about getting a home loan or changing your current home loan. With many people reducing their hours or completely being out of work, it can put a lot of pressure on financially and this can cause stress to you in regards to a current loan or it can put you off wanting to apply for a new loan. However, there is still a lot to consider during these times.
Are home loans still being approved?
In the short, yes they are. The lenders are doing their best to keep normality and allow people to still apply for and be approved for home loans, however they are becoming a lot more strict with their approvals during this time. Interest rates are at an all time low and are continuing to drop, which makes for a good time to purchase a home or investment property.
The main thing that the lenders are looking for is serviceability and whether you are going to be able to continue with your repayments. There is a higher chance of being approved for a lower amount or being declined at the moment as they become stricter with their lending, but this does not mean that you should steer clear of applying. With an experienced broker by your side, they will be able to help you to understand the process, evaluate your position and help you make the right decisions.
Can I refinance?
Refinancing your home loan is a process that is also still available at the moment. With the drop in interest rates, now is a great time to reevaluate your home loan, the rates that you are paying and have a look at what the lenders have to offer. If you are in a position where you are able to continue servicing the loan without any delays than looking at refinancing to save you some money in the long run is an ideal process. Lenders will still be strict with their approvals and it is best to speak with your broker before deciding to make any changes.
What if I can’t pay my loan?
If you are struggling with your repayments and having difficulty with paying them on time, it is important that you speak to your lender as soon as possible. Many lenders understand the current situation and are making different allowances for the clients, whether it be reduced repayments, repayments on hold or extending the loan so that you are able to have a few months of not having to pay. Before agreeing to any terms, ensure you read the fine print and understand any fees that they may be charging to do this.
This is a situation we have not been in before, however don’t let it stop you from achieving those dreams and goals of owning your own home.