I have seen a rising trend in self employed clients with business loans or overdrafts that are secured against residential property. In this general scenario most banks take advantage of this by loading interest rate by 2% or more per annum.
The Problem
[/frame_right]Whilst the use of the funds may be for business use, as long as the lender’s security is residential, I find it hard to justify the loaded interest rate applied to these types of loans.
The Findings
Based on a business loan of $300,000 and an average business interest rate of 9.00%, the interest payment would be $2,250 per month. Now compare that to a current average residential interest rate of 7.00% – the interest payment drops to $1,750 per month. This is a saving of $500 per month in interest alone that is added directly to your bottom line.
The Solution
The simple solution is to contact Simplified Finance Broking to have your business loans reviewed, to see how much interest you can save.
Why pay more when you don’t have to?
