With some lenders having already raised interest rates and speculation others will follow…..is now the time to fix your home loan?
Fixing your home loan provides repayment certainty. Locking in a fixed repayment for a period of time, usually 1, 2, 3 or 5 years can assist with household budgeting. This provides peace of mind and may protect you against interest rate rises during that time. The downside of fixing your home loan includes additional repayment limitations, economic break costs should you wish to sell your property or change the loan and forgoing potential savings should interest rates decline during the fixed period.
Variable rate loans provide greater flexibility and additional benefits, geared to help you save money and repay your home loan sooner. The benefits include unlimited repayments, offset accounts and portability just to name a few. The main downside of variable rate home loans is exposure to upward pricing pressure on interest rates created by market forces and other economic factors.
Generally, investors favour fixed rate loans to secure a consistent yield for a period of time, whereas owner occupied borrowers tend to gravitate towards variable rate loans or a blend of both to hedge their position.
If you are considering to fix or not to fix, please don’t hesitate to contact us.
Complimentary Loan Review: for a complimentary review of your individual circumstances, contact us at loans@tagfinancial.com.au or phone 03 9886 0800.
More information: go to www.tagfinanceandloans.com.au
Disclaimer: The information contained on this page is general in nature. Professional advice should be sought before acting on any aspect on this page.
TAG Finance and Loans Pty Ltd ABN 25 609 906 863 Credit Representative Number 483873
National Mortgage Brokers Pty Ltd ABN 88 093 874 376 Australian Credit License 391209