We're All Going on a Summer Holiday!
We all know that this year’s winter has overstayed it’s welcome and with the first glimpse of sunshine only now appearing, it’s time to think about where you want to spend the best part of this summer!
If you’ve been dreaming of taking the kids to Disneyland, wanting to propose to the Love of your Life under the Eiffel Tower or sit poolside on a Mega Cruise Ship while crossing the Atlantic Ocean, you might want to consider your borrowing options to tick these items off your Bucket List.
Financing your dream holiday can be serviced in more than one way. You may want to take out a Personal Loan, re-finance your home to use the equity or apply for a new credit card with sufficient funds to turn the dreams into reality.
A PERSONAL LOAN is usually a smaller amount of money (than a mortgage) and is often re-paid within a shorter time frame with a typically higher interest rate than a home loan. Personal Loans are popular with those that don’t have a mortgage or for the Home Owners wanting to keep their mortgage payments separate to their lifestyle costs.
ADVANTAGE – paid off sooner than a home loan, suitable to travellers who don’t have a home loan to leverage from the equity.
DISADVANTAGE – Higher interest rate, higher repayments.
Another option is DRAWING DOWN on the equity of your Home Loan. This is a popular option with families or home owners who have been busy making extra repayments to their home loan, creating a “forced savings” opportunity. The extra repayments made by the home owner have been accumulating or is off-set against the home loan, while paying off the debt and with the right home loan package, this money can be drawn on for use by the home owner for big-ticket items such as a much needed holiday. Not all home loans have a re-draw facility so check your finance package to see if your loan is eligible.
ADVANTAGE – the funds are already there, sitting in an off-set account, easy to access.
DISADVANTAGE – limited equity, might not be enough funds for desired use, once equity is re-drawn the mortgage goes back to a higher amount of debt.
If you have been considering RE-FINANCING your home loan and setting up a better mortgage and lending package, timing it with an expensive holiday might be the perfect reason to source a new home loan rate. You can re-finance with either a new lender or your existing lender but with a new interest rate and package to suit your lifestyle needs.
ADVANTAGE – a more suitable finance package may be available since you first took out your home loan. Your circumstances may have changed and a new lending package and rate may now apply to you.
DISADVANTAGE – re-financing may not be the best option for those that are time poor. Sourcing a new loan or better deal, followed by drawing up new mortgage papers and bank valuations all take time.
When choosing to finance your next big holiday, consider yours and your family’s circumstances to make sure that you don’t return from a dream holiday with a credit blowout! Seek professional lending advice from a mortgage broker. Brett, from Loan Market Ellenbrook can discuss your financial needs, your lifestyle and your personal circumstances with you to help you find the best loan so you can turn that holiday dream into a reality!
Send us an enquiry through our website or contact our awesome staff on 6296 6007 to turn your dream into a reality very soon!