It’s no secret that times are tough right now. Most families are really feeling the pinch with living costs dramatically rising in the last year.

And, don’t get us started on the interest rates!

In tough times, it is important to lean on the knowledge of experts. Right now, a mortgage advisor is one of the best experts you can engage.

Why is that? Read on to find out the answer and to see what is currently going on in the world of finance.

The Value Of A Mortgage Adviser In Hard Times

When the economy feels like it is in freefall, interest rates are up, and a lettuce costs more than $6 at the supermarket, it can be hard to stomach. That’s where the support and advice of an expert can be a welcome relief.

Here’s how a Mortgage Adviser can help during tough economic times:

Financial Assessment

A mortgage adviser can help you assess your current financial situation, taking into account any changes or challenges brought about by economic conditions. They can review your income, expenses, and existing debts to determine the feasibility of obtaining or maintaining a mortgage.

They can then provide informed advice about ways you might be able to save in some areas to ease the pressure you are feeling.

Mortgage Options

An adviser can provide an overview of the mortgage options available to you in the current economic climate, whether you are seeking advice on new lending or your existing mortgage. They can explain the various types of mortgages available, the impact of current interest rates, and the terms of each lending option, plus help you understand which is most suitable for your circumstances.

Market Knowledge

A key part of a mortgage adviser’s job is to stay updated on the local real estate market and economic trends. They can provide insights into market conditions, property values, and mortgage lending practices during all economic times. This knowledge can help you make informed decisions regarding buying, selling, or refinancing property.

Budgeting and Affordability

During challenging economic periods, it’s essential to create a realistic budget and assess the affordability of your current mortgage or any future borrowing. A mortgage adviser can help you evaluate your income, expenses, and mortgage repayments, taking into account potential fluctuations in income or interest rates.

By having a total understanding of your financial commitments, they can provide informed advice tailored to your personal situation. That will result in a budget that aligns with your financial situation and long term goals.

Negotiation and Support

When negotiating mortgage terms or dealing with financial institutions, having a knowledgeable adviser on your side can be advantageous. They can help negotiate interest rates for new or existing lending, loan terms, and repayment options on your behalf, ensuring you secure the best possible deal for your personal circumstances.

Risk Mitigation

Tough economic times often bring uncertainties and risks when it comes to your mortgage and other finances. A mortgage adviser can help you understand the potential risks associated with your mortgage, such as changes in interest rates or job security.

They can assist in developing risk management strategies, such as exploring fixed-rate mortgages or different loan structures to provide stability and peace of mind.

Call In the Experts

As you can see, there are plenty of benefits to working with a mortgage adviser, regardless of what the economy is doing. But, it is important that you work with one that you can trust.

The team here at Mortgage Suite would love the opportunity to advise and support you on any lending decisions. Whether your fixed term rate is coming up for renewal, you are having trouble with your current repayments, or you’d like to explore new lending options, we are here to help.

Chat with our team today!

What’s Happening In July?

OCR On Hold

As suspected by many financial experts, the Reserve Bank announced on 12th July that the OCR would be held at the current rate of 5.5% and expects to keep it at that level for some time.

So, what does it mean for mortgage rates?

Well, we are unlikely to see much change this year. However, predictions are that rate cuts could be seen as soon as the first quarter of 2024. “Barclays expects 25 basis point cuts at all the meetings in the first six months of 2024, with the cash rate reaching 4.75% by May 2024. [source]”

“ASB is expecting inflation to fall back into the 1-3% target band in the second half of 2024, fairly similar to the RBNZ’s view. [source]” “Corelogic suggests mortgage rates appear to be at a generalised peak, and this will allow households to quantify their ‘worst case’, with some starting to make property decisions again. [source]”

Again, it is a case of watch this space about the specifics, but based on the current information, it seems interest rates shouldn’t go much higher than they currently are. As always, we would definitely recommend consulting an expert financial adviser before making any moves when borrowing or refixing. Reach out to our team for helpful advice at any time.

The Item We Won’t Compromise On

There’s no denying that most families are tightening the belt on their finances and discretionary spending. But, there is one thing that we Kiwis are not prepared to let go of just yet.

And that is a well-brewed cup of coffee!

Households are not spending on the big items currently, but they are willing to spend on the smaller things in life. Spending at cafes, restaurants and bars lifted by 4% over the June quarter. So, if you still stop in for the occasional barista-brewed cup of joe, you are not alone!

Get in touch with the Mortgage Suite team now if you’d like to work out whether you could fit more coffees into your budget!