Fixed interest Home loan rates

Should You Lock In A Fixed Home Loan Rate? The Australian Bureau of Statistics (ABS) report that more Australians are locking in fixed rate home loans. But, before jumping on the fixed rate home loan saving’s wagon, experts suggest that new home buyers looking for a home loan and existing home loan holders looking for better rates need to compare costs and explore all possible fixed home loan pitfalls.

The amount of fixed rate home loans has jumped to 17.4 percent, the highest level since 2007. At present, the average 3-year fixed rate home loan offered by Australia’s big four banks, known as the Commonwealth, NAB, ANZ and Westpac, hovers around 4.98 percent. Two years ago, this rate was 7.23 percent.

However, many Australian’s are purely looking at the interest rate of fixed home loans, rather than comparing home loan’s fees and charges and features. Economists are also suggesting that the Reserve Bank of Australia (RBA) may make one more rate cut early next year. If this occurs, it may lower interest rates even further.

What Should I Consider Before Locking in a Fixed Home Loan Rate?

To ensure that you are making a sound financial decision about fixing your home loan rate, one that is not costly in the long-run, it is suggested that you consider the following aspects:

1. Your Own Circumstances

We are all different and have varying financial and personal needs, therefore there is never a one-size fits-all solution. In order to make a decision about a fixed rate home loan, you need to consider your own circumstances carefully, both now and well into the future.

2. Compare Fees and Charges

Look at the cost of fixing your mortgage and changing your home loan. Application and exit fees, ongoing costs and property valuations are costs that you can possibly encounter when fixing a home loan’s rate. These costs can add thousands to a home loan’s value. Always make sure you do the math before you sign any contract.

3. Understand Break Fees

Most fixed rate home loans have a ‘break fee’ clause that prevents the lender from sustaining a loss, should you elect to withdraw from the home loan before the end of its term. Sure there are now laws in place that prevent this fee from being exorbitant, but a lender is still allowed to recoup their costs. So don’t be lulled into a false sense of security. Instead you need to be aware of what your break costs are and when and how your lender can enforce these.

4. Get a Handle on Extra Home Loan Repayment Restrictions

Most fixed rate home loans will not allow you to make additional repayments on your loan, or if you can make additional repayments, these are restricted to a certain amount such as $10, 000 per annum. If you pay more than this amount off your home loan, then your lender can penalise you.


Home mortgage rates drop again...

2013-10-03 11:42:57 by SadRenter44

Mortgages got more affordable again this week.
The average interest rate for the most popular kind of home loan, the 30-year fixed rate, fell to 4.22%, down from 4.32% a week earlier.
Rates, as measured by a weekly Freddie Mac survey, have dropped from 4.57% since the Federal Reserve unexpectedly announced three weeks ago that it would not alter its stimulus program of buying Treasury bonds and mortgage-backed securities.
Most industry experts had thought the Fed would start to taper off those purchases, which bring liquidity to the mortgage markets and help keep rates low

Idea to make money from the equity in your home.

2013-04-24 21:34:24 by BSchwan

Hi, I have a commercial property in Fairfax and I have been looking at getting financing for it. It occurred to me that residential has wonderful rates with fully amortized loans while commercial has higher interest rates and usually fixed rate loans for only 5 to 7 years. My idea is that if one or two people had equity in their homes they could borrow on it at around 3.5%, they could then loan it to me at 5.25% and make 1.75% on the equity in their home. I would get a long term loan with a fixed interest rate. You get an extra $742.00 a month for the next 30 years and hold the first on my property

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Home > Blog > Current Mortgage Rates For Tuesday December 10 2013  — Mortgage Rates & Trends
To recap: currently the Fed is buying $85 billion in MBS and Treasuries per month in an effort to drive down long term interest rates and encourage lending, in an effort to stimulate the economy.

Current mortgage rates at Bank of America (Thursday November 28, 2013)  — USFinancePost
Current mortgage rates at Bank of America The customers looking for new home purchase or refinancing deals at Bank of America (NYSE: BAC) BAC +0.03% might have to face some ups and downs today, when it comes to the underlying rates of interest.

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  • Avatar JohnPau2010 Do we get a good deal if we apply for a home loan in a bank where I have account ?
    Apr 03, 2009 by JohnPau2010 | Posted in Renting & Real Estate

    I am have been maintaining a bank account in Citibank from past 8 years with good record. My fico is also excellent. 1) If I apply for home loan in the same Citibank, will I be getting any good deal and interest rate ? 2)Or can I get good deal from somewhere else also ? 3) Is it good to deal with a mortgage broker ?

    • Some banks offer point discounts to existing customers in good standing. That doesn t mean that they will give you the best rate. You only need a broker if you don t feel like shopping for a mortgage yourself. I would get at least three quotes. Shop them close togetherrates are very low right nowand it won t affect your credit score. Call your local banks or credit unions and consider larger national chains as well. I don t know where you live, but we bought a new house and got a discount for going with their lender and they paid our closing costs. It wouldn t hurt to check new construction bc …