What do people think about fixing their home loans now?

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  bbqwer on 27/08/2013 - 16:33

  -1

  If you have OFF-set account , you wont need to worry changing bank.

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  mskeggs on 27/08/2013 - 18:33

  fix half, leave half variable. Make sure you make a decision and don't just put it off or you will kick yourself when rates go higher.

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  macrocephalic on 27/08/2013 - 21:10

  Statistically you're almost always better off staying variable. The banks have a lot of people doing a lot of modelling to figure out what rates will be over the period of the loan and they wouldn't offer to lock you in at 5% now if they thought rates would shoot up to 10%.

  The benefit of fixed rates is the stability.

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  [Deactivated] on 28/08/2013 - 01:02

  +1

  I would talk to a mortgage broker about refinancing the only thing you have to worry about is sometimes they might suggest a bank that is going to pay higher commission to them rather then the best fit for you, but this is rare a lot of them choose to do best they can for you because they know if you are happy it means referrals for them. I spoke to Laurie from Citywide Lending 0405546256(Sydney) he came highly recommended by a family member and I was happy refinanced my loan from 7% down to 4.99 variable this was a few months back now

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  Ebayee on 28/08/2013 - 05:48

  Does anyone know how much a broker get commission from a bank , would it be a life of the loan or one off ? Suppose I get a good rate via broker , is there any hidden fee in the rate that I am not aware of from the bank (eg. percentage pay for the broker ) ?
  Was told when looking for car loan , the rate is not important , how much the repayment is the important thing . Does it apply for home loan?

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  pebee47 on 28/08/2013 - 08:24

  Ebayee, as a former Finance Broker I was paid virtually the same from all the lenders EXCEPT for the loans such as Low or No Doc. The Lenders paid the commission for A: bringing them business and B: having Applications fully documented and essentially ready to be ticked off, thereby saving them time (= $$). There was also a clawback proviso, so if the borrower pulled out before a certain time (gen 3-5 yrs), some or all the commission had to be paid back. Yes there was an on-going commission, quite low, but there to encourage the Broker to maintain contact and "service" the borrower, making sure they were happy with the lender's product (their loan). The problems arose when rogue brokers would "churn" ie after the clawback period, contact the borrower and "sell" them on a new loan that was not necessarily any better than their current one.
  The things to look out for include: How long before you can avoid paying a termination fee (0 - 7yrs) and how much; full or partial offset and if free; monthly fees for extra benefits; if no offset, redraw limits on min amounts and number per year and their cost; fees for extension of loan amount or time; default fees.
  How "nice" the lender is if things go pear-shape can only be judged by how others you know of have been treated.

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  pebee47 on 28/08/2013 - 08:31

  Oh, and the banks don't give you a cheaper loan if you go direct. As a broker I had access to over a thousand different loans. The usual banks offer about 20-30 different loans. Find a good Broker, tell them what you want to do (pay off slow at first so you can study/travel/invest then accelerate payments; pay more now to get rid of debt; pay interest only as it is a rental investment for 5 yrs then sell; etc,etc) and trust them to come up with a selection of suitable loans you can choose from.

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  pebee47 on 28/08/2013 - 08:37

  It is extremely rare for a Bank to lose out on a fixed rate.
  They usually start higher than the current variable rate when it looks like the var rate will rise, and not much if any lower than the var if it looks like the var rate is going to drop. Investors often like them as it becomes a fixed cost that can be factored into their portfolio.

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  pauldegab on 28/08/2013 - 15:26

  Unless you think the economy is going to pick up in the near future, I'd leave it as a variable rate. Even the government is forecasting unemployment to be higher this time next year, so I can't see rates going up in the short to medium term.