Benefiting from a steady interest rate
Are you nervous about buying property in Mpumalanga, in this article we discuss how the MPC’s meeting has a positive outcome for homeowners, and how you can ensure that you benefit from it in the long run.
Don’t be nervous about buying property in Mpumalanga, according the MPC (Monetary Policy Committee) the positive outcome ensures that at present the prime lending rate will remain at 10.25% as well as the repo rate at 6.75%. While this is great news for many South African’s, we will discuss ways you can make use of this positive news and better ensure for the future when these rates are bound to go up.
Like many South Africans you will probably want to go out and celebrate, but experts say that instead you should consider tightening your belt while times are not so tough. By doing this you are making sure that you and your family are already used to living off of a smaller budget for when times get tough.
Adrian Goslett, Regional Manager and CEO of RE/MAX Southern African suggests that by adding an additional 0.25% to your monthly home loan repayments, and securing it in an interest bearing account. That way you will have accumulated some emergency money for when the need arises.
He goes on to say that by reinvesting the money that you would have spent into your home loan, should the interest rate have risen, you can not only save a huge sum of money in the long run, but also drastically shorten your repayment period by as much as two years. Putting in an extra R500 per month would shorten the repayment period by two years and save you around R200,000, which is enough to buy a slightly nicer car or put your kid through high school with some change to spare,” says Goslett.
It is then a no brainer, that by saving when times are good, secures your finances for when times are tough.
