Interest rates go up and down; there is no other way around it. You don’t want to be caught off guard when interest rates soar. When starting off, it is always a good idea to compare housing loan rates in Singapore, so that you are sure that you are getting the best deal. When faced with rising interest rates, the first thing you need to be mindful off is not to panic. There are still options available to you. In the event of rising interests, here is something you can do:
1. Prepare to pay a little more
You should start by saving and reducing your expenditure, as the amount you will have to pay will increase as interest rates rise.
2. You can protect yourself beforehand
There are ways to protect yourself from paying more interest when interest rates increase, but it depends on your ability to plan. If you are in the position to do so, then you can pay more today as opposed to tomorrow, buying yourself time when rates go up in the future, by creating a buffer.
3. Lengthen the duration of your loan payment
Another thing that you can do if you are short of cash and unable to pay a higher interest rate is to talk to your bank or financier and lengthen the period of your loan payment. This means that if previously you were supposed to pay a certain amount over a period of five years, you can pay that amount in let’s say ten years. This will not only give you time but also decrease the overall pressure, and you may not necessarily have to make financial adjustments elsewhere.
4. Consider a different payment plan
With matters like this, it is always a good idea to take advice from your financial manager, or if you don’t have one, you should still seek professional help. If all options fail then you can go for a different payment plan together. It may even include looking into refinancing housing loans in singapore