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The Outlook For Interest Rates In 2022

Whether you already have a mortgage or are considering one, it’s understandable that many Australians are nervous about potential changes to interest rates. 

Interest rates are essentially market prices, which means they are a function of what can be broadly dubbed a case of supply and demand. There are both short term and long term factors that have driven interest rates lower on a global scale, all of which have in one way or another affected us here at home.

The-Outlook-For-Interest-Rates-In-2022

Although they are currently sitting at record lows almost on a global scale, many homeowners right around the nation are understandably anxious about what the future holds for them in the event of any changes. However, the real question at hand is not necessarily if interest rates are expected to rise, but when?

What The Next Year Holds For Interest Rates

Long before the pandemic arrived on our shores, the Australian economy was already showing signs of slowing down, and our economic growth had started to slump. Exacerbated by the effects of the once in a generation health crisis, other contributing factors included ongoing trade wars, heightened political uncertainty in a number of countries and a lack of manufacturing activity.

In an effort to stem this, the Reserve Bank Of Australia continued to drop interest rates to record lows in an effort to keep our economy moving – and it worked. Record low interest rates did their job when it came to supporting the national property market, with Australia currently in the midst of the biggest increase in the national house price average in seventeen years. 

However, nothing lasts forever. In March 2021, the Commonwealth Bank of Australia announced its lowest ever fixed rate for home loans on two year fixed periods, dropping to 1.9% per annum. The real surprise though was the announcement in relation to the bank’s four-year fixed term. For owner occupiers, the four year fixed interest rate rose from 1.99% to 2.19%, making them the first of the big four banks to hike the four year rate since October 2019. 

With limited supply and ever increasing demand, in October 2021 the Australian Prudential Regulation Authority (otherwise known as APRA) took steps to help ensure that borrowers were capable of making mortgage repayments if – or perhaps, when – home loan interest rates rise. Previously, the minimum interest rate buffer on home loan applications was 2.5% points. In November 2021, this is set to increase to a minimum of 3%, and is a tentative step by the regulator to cool credit growth right around the nation. APRA estimates the small change to Australia’s loan servicing rules will reduce the average person’s maximum borrowing capacity by around 5%. 

Considering this complex economical tapestry, are interest rates likely to rise anytime soon? According to what the data tells us, apparently not. As of November 2021, the Reserve Bank of Australia has left the cash rate at 0.1%, and has indicated a rate hike is still some time away. So much so, that RBA governor Philip Lowe has indicated that until inflation and wage growth stabilises, an interest rate hike is unlikely to be seen before the end of 2023 – defying the expectations of financial markets and industry experts alike. 

If you’re concerned about interest rates in both the immediate and distant future, it’s worth consulting with the professionals instead of nervously speculating. For prospective first home buyers, it’s important to sign up for a home loan product that is best suited to you with the most favourable terms. For existing homeowners, undertaking an annual home loan health check is considered to be the best way to carefully assess your overall financial position and identify any potential risk factors – but who can help with navigating the world of mortgages?

Partnering With The Brisbane Mortgage Professionals 

Getting preapproved for a home loan or taking the time to conduct a home loan health check has long been regarded as stressful, frustrating and time consuming – but the good news is that it doesn’t have to be.

Since their inception in 2012, the team at Madd Loans have worked tirelessly in providing over 2,000 Queenslanders with finance options to help turn their dreams into reality. With the entire brand being built on referrals, owner George Samios takes great pride in making the loan process both fun, educational and stress free – and he has a swag of awards to prove it.

If thinking about your financial future strikes a chord with you, then it might be time to speak to a professional. Whether you’re chasing mortgage solutions or a financial fairy godmother, the team at Madd work together as a collective to turn your goals into reality.

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Madd Wins Queensland Brokerage Of The Year

Established in 2012, the Madd mission has been to create raving fans from both our clients and our staff through exceptional customer service and strong industry relationships. Madd Loans owner George Samios describes the business as being built on referrals, and consumers will have a hard time finding a more innovative or dedicated mortgage broking centre in South East Queensland.

In fact, George has a swag of awards to prove it, along with features on “Ready, Set, Reno!” and numerous television broadcasts. By providing a memorable and fun experience for consumers navigating the realms of finance, George has stuck to this simple formula in order to maintain and elevate his brand to the best that it can be.

Madd-Wins-Connective-Awards

It would seem that this code of ethics has proved to be a winning formula, as both Madd Loans and George himself have managed to take out yet another batch of awards when it comes to recognising the best brokers in the industry. In September, Madd Loans were awarded the title of “Brokerage Of The Year < 5 Brokers” in Queensland, while George himself has taken out the gong for “Broker Of The Year” at the 2021 Connective Excellence Awards.

Proudly sponsored by some of the biggest lending institutes operating in Australia, Connective Asset Finance are an award-winning business platform in their own right, and hold the awards annually as a means to recognise and celebrate the very best contributors in Australia’s mortgage broking industry. According to George himself, his secret formula is combining innovation with a world class customer experience.

“Our point of difference in the mortgage brokering industry is that Madd Loans actively encourages both our new and existing clients to get behind our brand, and to be as proud of it as we are. We pride ourselves on our independent way of doing business, our second to none customer service, and our engagement within our local community. However, this hasn’t stopped us from pioneering new ways of making the world of mortgages fun, as we’ve consistently embraced technology and innovation to improve how our clients relate to their finances. We ask, we listen and we adapt accordingly, and the results include the expansion of our services into end to end financial advice through the development of Madd Life.

With an ongoing customer satisfaction rating of 98%, Madd Loans continue to obtain the vast majority of new clientele through referrals. Each member of the public that enters the state of the art office is greeted with all staff members standing up to address them, continual refreshments, access to boardrooms and even receive a ‘show bag’ containing branded accessories upon their departure. For this reason, a part of the “Madd” experience is actually the office itself – every single one of the Madd clients are treated like celebrities. However, George is also the first to agree that the strength of the brand is all down to the passion of his team.

“I made a conscious decision a few months ago to start making the next generation passionate about the finance industry. One such example of this is with our other in-house mortgage broker Costa – I seem to have successfully molded someone who is actually better at my job than I am. In every single meeting with a client, he’s fully present, treats his customers like his own family, and ensures that his communication is clear and transparent at all times while still getting real results. He is a sponge for absorbing information, and is on the fast track to one day winning awards like Broker Of The Year himself. Other than helping Queenslanders to kick their property goals, watching our young guns flourish is easily one of the most rewarding parts of my job.”

As a result, there is an enormous amount of respect in the wider community for George not only as an employer, but as a mentor, a father figure, and a friend. It’s not uncommon for the Madd Loans team to spend large chunks of time together outside of the office, such as hikes as a team bonding experience, or birthdays on a Sunday afternoon at the local lawn bowls club.

George steers his Madd ship with complete transparency, and has shifted his focus to cultivating a new generation of mortgage brokers, loan administrators and credit analysts of people from all walks of life. In the eyes of both George and his team, combining this sense of family with razor sharp industry knowledge, tenacity, passion and a world class customer experience is what makes them a multi award winning team.

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A Day In The Life Of A Mortgage Broker

If more people understood the role of a mortgage broker, then perhaps more people would utilise one – so what does a typical day for a broker look like?

As of 2020, 6 in 10 Australians used a mortgage broker to assist them in acquiring a home loan to purchase property – the highest that it has ever been. What’s more is that 90% of these customers reported that they were happy with the services provided to them. If the feedback is that good, then why aren’t more Aussies using one?

A-Day-In-The-Life-Of-A-Mortgage-Broker

Well, to put it simply – the world of banking is big business, and as such, there are many lending providers to choose from. Since purchasing a home is generally not an everyday purchase for most Australians, navigating the many finance options can be overwhelming – which is where the services of a mortgage broker can be a life saver.

In a nutshell, the role of a mortgage broker is to act as an intermediary, or someone who navigates home loan products and their applicable terms on behalf of individuals or businesses. They serve as the ‘middleman’ between the lender and the borrower and handle the time-consuming process of securing the loan and gathering the considerable paperwork involved.

However, the everyday tasks performed by a mortgage broker are often vastly different than what most people would assume. If you’re considering partnering with a broker to obtain a home loan – or are perhaps even considering becoming one – what’s it all really like?

Get To Know A Real Life Mortgage Broker 

With a dual degree in Law and Commerce (Accounting), Brisbane local Costa Demetriou has certainly been a busy man over the course of the last few years. After working as a legal clerk and an accountant, Costa joined the team at Madd Loans in 2017. Regarded as Brisbane’s most innovative and award winning mortgage broking firm, the team at Madd are just as diverse as their many clients. 

His unique background in the finance field brings a unique insight into the industry for Madd customers. Costa loves the ethics of Madd – which he refers to as “a company loyal to its customers, not the banks”. A community man, Costa has also been volunteering at the Greek Paniyiri Festival for over thirteen years. Never one to sit still, on most weekends you’ll find Costa attending open homes in the Brisbane region, to ensure that he’s always up to date on the area’s property trends – and yet, Costa still ensures that there’s still time to schedule the all important backgammon game every Sunday with his beloved Pappous. Needless to say, as one of Madd’s go-to mortgage brokers, he’s certainly learned a lot during his time under the wing of Madd Loans founder and finance powerhouse, George Samios. 

“My day to day life as a mortgage broker is everything and nothing like what I thought it would be when I originally joined the Madd Loans family. From day one, my mentor George drilled into me a distinct code of ethics of sorts in regards to always putting the best interests of our customers first. It doesn’t matter if you hold personal preferences in regards to certain lending providers or loan products, because each and every one of our clients will have different needs from their home loan. Being a good mortgage broker requires honesty, innovation, tenacity and a proactive approach at all times.”

At Madd Loans, every mortgage broker learns the ropes from the ground up. New recruits almost always begin their broking career as a junior credit analyst, before working their way up to more senior positions within the business. According to Costa, this “apprenticeship” helps to ensure that the Madd mortgage brokers understand the ins and outs of the world of home loans from every level. However, what he didn’t bank on was the education of sorts that the clients themselves provided him along the way too. 

“I learned very early on that the relationships between the Madd Loans team and our customers formed the backbone of our business. Without them, none of us would be where we are today, and it’s so much more than just a transaction. A good mortgage broker needs to understand the long term goals of clients in order to help them in every sense of the word. From $500,000 loans to $5,000,000 loans, every client deserves and receives the same level of service, as we place an enormous value on the customer experience they receive as a means to forge a life long partnership. Personally, one of my favourite parts of the job is seeing my clients in the real world. Whether it’s over a coffee or just having a quick chat in the street, the feeling of contributing to my local community is really what gets me excited about going to work every day.”

One common reason that consumers stick with a bank that they’ve used all of their life is security – after all, they’re unlikely to go bust anytime soon. The thing is though, banks are not obliged to ensure that your interest rates are competitive, and are generally not renowned for rewarding loyalty. In comparison, enlisting the services of a mortgage broker is essentially like adding a star player to your finance team, who does the leg work on your behalf as a means to cut down on time, stress, and ultimately, get you the best and most suitable deal on a home loan – but where do you find one?

Partnering With A Brisbane Mortgage Broker

Getting preapproved for a home loan has long been regarded as stressful, frustrating and time consuming – but the good news is that it doesn’t have to be.

Since their inception in 2012, the team at Madd Loans have worked tirelessly in providing over 2,000 Queenslanders with finance options to help turn their dreams into reality. With the entire brand being built on referrals, owner George Samios takes great pride in making the loan process both fun, educational and stress free – and he has a swag of awards to prove it.

If thinking about your financial future strikes a chord with you, then it might be time to speak to a professional. Whether you’re chasing mortgage solutions or a financial fairy godmother, the team at Madd work together as a collective to turn your goals into reality.