In particular we focus on getting the loan structure right the first time, choosing which lenders to use in the right order (yes this is important) and finally getting our clients the best deal possible.
Pros
- Predictable payments – the repayments don’t change, so you will know exactly how much they are and can make budgeting easier.
- Protection against rising interest rates – unlike variable rates, if the rates rise over time, your rate will remain as it is
- Stability – they can be advantageous for long term financial planning
- Good for low-rate environments – if you are able to lock in when the rates are low, they you can benefit from paying less interest over the loan term
Cons
- Rate cuts won’t apply - if interest rates decrease, your rate will remain the same
- Lack of flexibility – if you want to pay additional repayments, refinance or sell your property before the fixed term has ended, there can be significant break costs
- Fewer features – many features that come along with a variable rate loan like offset accounts and redraw aren’t available for fixed rate loans
