Aussies 'to pay back more on home loans if rates fall'

Mozo

Thursday 08 September 2011

Should the central bank opt to reduce interest rates in the coming months, 57 per cent of Aussies plan to pay more back on their home loans than is required.

Interest rate reduction 'will tempt Aussies to pay back home loans faster'

A study conducted by Mortgage Choice revealed that 50 per cent will use all the money they save as a result of the decline to contribute more to their repayments, while seven per cent will use some of the funds.

Kristy Sheppard, spokesperson for the firm, observed that 96 per cent of respondents will save either more money or the same amount should the Reserve Bank opt to cut rates.

She noted that many will be relieved at the decision on Tuesday to keep rates at the 4.75 per cent level set in November 2010.

However, she asserted that the majority would have been happier if there was a reduction, commenting: "Sanity prevailed with September's cash rate decision. It should lead to improved consumer and business confidence as spring moves in."

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