When Can a Fixed Rate Loan Help You?
Fixed rate home loans allow you to lock in unchanging monthly repayment amounts. The obvious advantages of this arrangement are predictability and reliability – as planning your finances is a lot simpler when you know exactly what you’re going to be paying.
But there is another advantage to the fixed rate home loan that many Australians are benefiting from right now: Record low interest rates. Taking on a fixed rate home loan when interest rates are low means that you can “lock in” the low interest rate for a fixed duration, even if interest rates spike up during it.
If you’re interested in a fixed rate home loan (as many Australians currently are), you can read all about Mortgage House’s fixed rate home loan options here.
Should you consider a fixed rate home loan?
If you’re fond of the idea of paying low interest rates through predictable monthly repayments, then you should almost certainly join thousands of other Australians in considering a fixed rate home loan.
Interest rates are at their lowest point in decades, and it’s impossible to predict how long an opportunity such as this one will last. It’s possible that interest rates will never be this low again, so this may be your last chance to take out a loan at these rates.
The advantages of fixed rate home loans
But even if interest rates weren’t currently sitting at record lows, many people take on fixed rate home loans for the certainty they provide.
Having predictable repayment amounts means that you can maintain a certain standard of living and make accurate financial plans for the future. This is especially advantageous for those without a tremendous amount of leeway in their budgets.
But of course, the bonus benefit for Australians right now is the low interest rates. If the Reserve Bank of Australia spikes interest rates in the near future, those who took out a fixed rate home loan during this time will be immune to those effects.
At Mortgage House, we’re no strangers to the homeowner’s journey. It’s a long (but rewarding) one.
But don’t worry, we can help with that.
If you think that a fixed rate home loan might be the best choice for you, then we’d love to talk you through it. The cost of your mortgage can drastically affect your financial planning, so it pays to speak to the experts about it.