Advice Sought

Hi. I've come to this site because I need some help.

In the last two years, both my husband and I lost our jobs through redundancy. I am in my 50's and he is in his 60's (63). Luckily I have been in a new permanent job for the last 6 months but our income is now considerably less because hubby has been unable to get a job and my new one pays less than what I was on before. On the upside, our kids are now financially off our hands so we have less expenses.

Our current situation is we have assets (including PPOR and 3 investment properties) of about $3.3million and debt of about $1.6million. All loans are IO. $1.3million are on fixed rate of 4.89% until August 2016. The rest on variable at 5.05%. We also have a car loan and personal loan/credit cards of $50k. We are reaching a point where although we are able to continue all loan repayments we could have a better quality of life if we could reduce our repayments. We will look to sell our portfolio and downsize in about 5 years and retire but don't want to do that yet.

I am wondering given our now reduced income, if there would be any lender who we could refinance with at lower rates? We have not reported our financial situation to our current lenders. We were considering it to see if we can get lower interest on the PL but were scared of what might happen once they know.

Any advice would be appreciated.

 

You could only refinance if you can service the loan, according to the lender calculations. This will depend on your income and rents.

There is not need to disclose your current income to ask your existing lender for a rate reduction.

 

That's a high variable rate, especially if it's all with one lender. You will probably find you can get a better rate with your current lender. Who are you with?

 

Fixed rate with Westpac. Variable with AMP. AMP recently increased.

 

Which is your PPOR?

 

Westpac

 

Definitely worth trying to get that rate lowered, they're pricing aggressively at the moment. Exactly what's possible with your whole portfolio will depend a lot on what your income is at the moment, but just with the PPOR alone you should be able to make some savings without refinancing.