Break and Refinance Fixed Home Loan(Remaining~294000 @3.75%) Break Cost $3800

LEdinburgh on 15/03/2020 - 20:12

Hi Ozbs, need your opinion on how I can come out of this high-interest situation. Has anyone been in a similar situation?

Loan Details

Fixed-Rate Commencement Date 25/01/2021

Break Details
Loan Termination Date 15/03/2020
Number of Full Interest Periods Remaining 10
Partial Interest Period to Next Repayment Date 0.49
Balance at Last Scheduled Repayment $294,574.23
Swap Rate at Commencement Date 1.94%
Swap Rate at Termination Date 0.41%
Movement in Swap Rate -1.53%

Break Cost Quoted — $3,715.01

Financial

Comments

  • taoz on 15/03/2020 - 20:35

    dates dont make sense for one.

    do the maths, is the saving more than the cost
    what do you want a view on?

  • [Deactivated] on 15/03/2020 - 21:09

    Just do the maths on savings per month and see hpw long it takes to pay it back. If youre only dropping by 1% would just just over 1 yr and a bit to recoup interest savings based on loan balance.

  • tsunamisurfer on 15/03/2020 - 21:23
    +3

    I 100% support the banks penalising borrowers to the max of the contract for backing out of a fixed interest loan term.

    Basically the OP has put his money down at the BlackJack table, got a 7 and 8 and now wants to take the chips back.

    • djkelly69 on 16/03/2020 - 09:11

      Basically the OP has put his money down at the BlackJack table, got a 7 and 8 and now wants to take the chips back.

      What is the dealer showing?

      • jimdotpud on 16/03/2020 - 10:16

        doesn't matter what the dealer is showing, the bank will screw you either way

  • mortgagebroker on 15/03/2020 - 22:21

    You would have to get a very good rate to save $3715 in 10 months.
    maybe look into a lender that's doing a cashback to cover some of the break fee.

    • MS Paint on 16/03/2020 - 01:06
      +1

      Username sort of checks out.

  • Cheapskate Paul on 16/03/2020 - 23:58

    Just wait a little while and they'll be paying you to borrow money.

  • Garrettau on 17/03/2020 - 19:48

    Many banks offer 4k rebates to cover the break cost, not to mention lower rates

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