Fix price home loans are a great way to manage your weekly or monthly buget. with fixed loan terms you know exactly how long and exactly how much your loan repayments are going to be. Fixed loan terms wll not go up when the interest rates rise. Fixed loans are ideal for investors to manage your property portfolio, fixing your loan to interest only can give you a higher borrowing capacity.
Fixed price home loans also have their down sides, For example you can repay a maximum amount usually no more than $5,000 - $10,000 per year. Fixed home loans will have penalties for extra repayments over the maximum amount specified. Fixing your loan the interest rate will not drop with the offical interest rates and you can not topup, switch to variable or re-finance your home loan until the fixed term is ended with out encoring penalty fees.
variable home loan options have the advantage of being able to repay more off your home loan with no maximum or penalties, most variable home loans will fall with the offical interest rates reducing your monthly mortgage. Variable home loans can be fixed or refinanced at any time with a variety off different variable home loans with different options to suit individual needs.
Weather you are a First Home Owner, investor, re-financing, or re entering the market, make sure you read and understand lenders product disclosure statements about fixed and variable home loans and have an understanding on what suits your needs.
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