Fixed rate terms on your home loan last for a set period of time that is prearranged between you and your lender. Fixed rate periods generally last between 1 and 5 years.
When your fixed rate term ends, your loan will usually revert automatically to the standard variable interest rate unless you have provided instructions to refix your loan.
It’s important to plan ahead and talk to me, your mortgage broker before the fixed rate term approaches. We can discuss what your new interest rate and repayments might be and what your options are.
Repricing with your current lender
Lenders may not apply the lowest interest rate they offer when a loan reverts to a variable rate.
I will ask for a reprice to a more competitive rate on your behalf so that you can keep with your current lender at a competitive interest rate.
Refinancing to a different lender
Once your fixed rate term ends, you may be able to refinance to a different lender with more competitive interest rates and possibly a cashback offer from a new lender.
While the interest rate is a key factor when choosing a loan product, it’s important to know the ‘true cost of switching’. There are a myriad of fees and charges involved in discharging and setting up a new loan that you will need to consider.
I can help you understand what it will actually cost you to change lenders, and how much you could save. Get in touch if you would like to discuss your options.
