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CBA Home Loan 5 Year Fixed Rate 4.99% (5.62% CR)!

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CBA Home Loan 5 Year Fixed Rate 4.99% (5.62% CR)!
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Lmerchant_0312 on 23/07/2014 - 14:57 commbank.com.au (1982 clicks)
Last edited 23/07/2014 - 16:43 by 2 other users

for years I have discovered amazing deals on Ozbargain and finally my conscience has forced me to find a good deal and post (contribute) something to all you good people out there..

Anyone looking to get a home loan.. 5 year fixed of 4.99% is unheard of!! Atleast in the last decade..
I was about to lock into a 3 year at 4.85 (when 5 year rate was 5.6) and now I will wait and hopefully lock in for 5 years for under 5%.

Good luck!

Some info (Thanks @Cluster)
There is a $750 fee for each Rate Lock
Establishment fee: $600.
Monthly loan service fee: $8.
Comparison rate: 5.62%

Financial Home Loan

Related Stores

Commonwealth Bank
Commonwealth Bank

closed Comments

  • markis on 23/07/2014 - 14:57

    not bad.

    • vid_ghost on 23/07/2014 - 15:40
      +4

      loans.com.au Dream Home Loan (Blackboard Special) 4.54% Variable Rate
      If we get another GFC and rates drop more fixed can be bad… also with some fixed rate loans paying out the loan by selling can also be a big sting in fee's

      http://www.infochoice.com.au/home-loans/interest-rates/

      • stingy-oz on 23/07/2014 - 16:17
        +1

        I almost got a loan with them about two year ago until i hears their customer's testimonial…….Got NAB to match the rates and fix it for next 2 years.

        • SmiTTy on 23/07/2014 - 16:21
          +1

          thats great you were able to get the same rate with one of the big banks!

          I signed up to loans.com.au quite a while ago and they have passed on the full rate cut with every RBA drop .. I've got no issues and a happy customer. Mind you i dont need much from my home loan - just an IO with offset without any other bells and whistles and i'm happy.

        • vid_ghost on 23/07/2014 - 16:28

          @SmiTTy:

          my two loans are with ING Direct and Aussie.. both have been fine but after 6 and 3 on the loans i have ended up with a higher rate then if i switch today!

      • kasp on 23/07/2014 - 16:53
        +2

        I swapped to loans.com.au and I am fairly happy with them. The paperwork seems more annoying than other banks but it's probably because they do extra checks to give the cheap rates they do. However the people are friendly and once that is done and dusted you have one of the cheapest loans around and they stay that way.

        I went with another provider who was the same rate as loans.com.au when I signed up with them and in under 2 years later they slowly raised their interest rate to the point it was half a percent more while loans.com.au have been consistently the cheapest loan in town. They also have a lot of features that usually only come with premium loans like offset accounts.

        Overall besides the annoying paperwork they are a great place and I would highly recommend them. The website is good and support seems great so far.

        • gibspmuh on 23/07/2014 - 21:23

          I'd echo the points listed by kasp. I'm with loans.com.au as well and apart from the cumbersome application process the rest has been fine. As mentioned the people I dealt with were friendly as well and there's been no issues with it since I got approved. Given the rate and the features they offer it's a great option if you meet their loan criteria.

        • suchsavings on 24/07/2014 - 18:13

          how much did it cost in fees to swap? i figure it would take me over a year to make back the cost of fees.. its hard to convince myself its worth it

        • kasp on 25/07/2014 - 21:21

          @suchsavings:

          Well it depends on the loan. I would say almost a grand when you take into account the discharge fee's and valuation's. However this depends on the loan you currently have.

          However considering the money we will save in the future it is really peanuts.

    • onlyletters on 23/07/2014 - 16:18
      +9

      I find that when they offer good deals on Fixed Home Loans, it means either the Interest Rate is going to stay the way it is, or will drop further. Thats just my 2c. I might be wrong.

      Source: based on experience 4-5 years ago.

      • vid_ghost on 23/07/2014 - 16:29

        Spot on!

      • Yowiefied on 23/07/2014 - 16:31
        +1

        No coincidence there. If the aussie dollar stays around the 93-94c range the RBA will be pressured to drop official interest rates. As the usd is trying hard to devalue their currency it will put pressure on australia to follow suit. I can see interest rates falling in the next few years, until they're relatively happy with how the aussie dollar is sitting.

        • elektron on 23/07/2014 - 17:10
          +9

          Some big assumptions you've made. RBA have actually indicated that they will not be dropping their rates unless the AUD continues to raise.

          The US will be forced to wind down of their loose fiscal policy (which has already started, albeit slowly), including 0% rates, which will result in the AUD weakening, allowing the RBA to raise rates.

          More importantly, the inflation has hit 3% today - the highest level in years, which is at the very top of RBA's bracket, which also indicates that the next move is likely to be up and sooner rather than later.

        • parcus on 23/07/2014 - 17:13
          +12

          Doubt it, inflation is far, far more important to the RBA than the AUD and right now inflation is right at the top of their 2-3% target band. Couple that with an particularly strong housing market and a relatively strong economy and I just can't see them reducing rates anytime soon.

        • elektron on 23/07/2014 - 17:16

          @bangbang:
          Exactly.

        • Sira on 23/07/2014 - 17:24
          -2

          @bangbang:

          Can't argue with money markets, instead of giving your 'informed' opinions have a look and see that they have factored in, with a 75% chance, a drop in interest rates on the next board meeting.

          Do you really think Australia's most profitable bank has suddenly decided to be a bit generous? NO!

          They know what's happening and they know another rate fall is coming.

        • onlyletters on 23/07/2014 - 20:43

          @bangbang: maybe they wont drop the interest rates, but its highly likely they will stay the way they are for a few years to come..

        • OzBLover on 24/07/2014 - 08:50
          +2

          @Sira:

          You seem to think that the banks are speculating about interest rate and they are betting that the rate would go down thus offering a low fixed rate. This is unfortunately not correct. the banks are not in the business of speculation- at least in theory. All loan rates - fixed or variable are determined by the deposit. They pretty much matching their borrowing funds with the loans and pocket the difference. this is also the reason why ppl have to pay quite a hefty amount if they break the fixed loan because it has already been matched with a fixed term deposit somewhere

      • AnDyStYLe on 23/07/2014 - 17:42

        I found the same too!

      • AssociatedBrianqpr @ Commonwealth Bank on 24/07/2014 - 09:36

        That's certainly what they think will happen, but they have been wrong before! Rates at historical lows and I don't recall ever seeing fixed rates before below 5% for 5 years.

        • brilliances on 24/07/2014 - 20:26

          But… I don't ever recall seeing negative interest rates in Europe before either!

          It's not that the CBA is 'betting' the rates will stay low. It is the whole financial world markets speculating that rates will remain low, that aussie banks are highly stable / profitable, and that's what allows CBA to source low wholesale rates and offer these long term fixed rates to consumers.

          In my experience, 5 years fixed is way too long. A lot happens in 5 years and having to pay high exit / early repayment fees kills this.

  • squaredonut on 23/07/2014 - 14:59
    +4

    But what is the maximum repayments you can make a year on this fixed rate? Fixed rate's generally seem to impose a crappy repayment limit.

    • merchant_0312 on 23/07/2014 - 15:04
      +6

      I believe you are referring to making additional payments over and above the minimum..
      All banks are different.. most let you pay approx $10k a year without having to pay any additional penalty..
      If you have lots of extra cash and want to make larger than minimum payments.. then I would say fixed loans are not for you..
      Fixed loans are for those who would like to lock in their cash outflow for a certain period (next 5 years in this case) without having to worry about interest rates rising on the first tuesday of the month..
      Lastly, one could always fix say 80% of the loan and have the balance sit in an offset account to minimise interest against the remaining 20% on variable.

      • squaredonut on 23/07/2014 - 15:39

        Yeah, that's what I meant. I was told by a few banks about this, since I was still a bit fresh to all the mortgage aspects. But having said that, if you were to fix a portion of your loan it would really depend on how good the bank's standard variable rate (+ any discounts they offer to you) is for this deal to be sweet I'm guessing?

        • sb944 on 23/07/2014 - 15:58

          This is good advice, but for the average person, I'd only bother having a 10% variable offset. Assuming buying a cardboard box in Sydney with a $500K loan, that's still $50K, so pretty easily allows for a chunk of emergency money, and a few years income growth. In the meantime, your emergency money account is 100% offsetting, and by the time the 5 years is coming up, you'll hopefully have $40K or so built up, and be paying nearly no interest on that account.

        • SmiTTy on 23/07/2014 - 16:24
          +2

          Its probably better suited to people such as investors who are happy to go fixed without having to put in extra repayments . Not to say home owners can't use this, but investors wouldnt have to worry about part fixed/part variable. The advantage of fixed is your (interest) expense is very predictable for the next 5 years which is great as an investor.

    • zanthius on 23/07/2014 - 15:04

      I just went through a broker to change my loan last month. The usual repayment max is around $10,000 / year for a majority of them.

    • DryScissors on 23/07/2014 - 16:12
      -1

      I agree. Fixed is only suitable for investment loans.

  • cornbeef on 23/07/2014 - 15:00
    +2

    Glad you are now conscious and that your conscience is working.

    • merchant_0312 on 23/07/2014 - 15:06

      i see what you did there ;) bad typo.. 3pm on a wednesday.. what can i say..

  • jv on 23/07/2014 - 15:05
    +11

    you nearly always lose out with fixed term…

    the banks have a risk premium built into that rate…

    • mr626 on 23/07/2014 - 15:09

      This was always my understanding of home loans. Basically with a fix rate, you are 'betting against the bank'

      Then again, as merchant_0312 mentioned having a fixed rate can be good if you are looking to lock in your repayments for a certain period.

    • martyn on 23/07/2014 - 15:12
      +1

      But most banks are offering around 5.5% fixed, so with this rate CBA is betting much lower than that. Seems a good deal if you want the certainty of knowing exactly how much you are going to pay for the next 5 years.

      • Make it so on 23/07/2014 - 16:10
        +9

        I totally agree. I think committing to a fixed-rate loan is like betting on what the interest rate is going to be against an opponent who is much for informed than you and has the upperhand. It's gambling at a disadvantage. The house always wins….

        It can be useful if you need to manage your risk, but statistically you are more likely to lose than to gain.

        • eye on 23/07/2014 - 16:29

          well said. And that also gives a big inconvenience if you would like to change security or do anything similar during the period. Currently still locked but probably won't lock it again unless we need to manage the risk. But in general, you lose.

      • sb944 on 23/07/2014 - 16:31
        +1

        That doesn't mathematically make any sense.

        Firstly, look at their other rates. The first 3 years make sense, like lower than 4.99, then slightly higher by 3 year, indicating it may go down before potentially going up in 2-3 years. But then quite a lot higher by 4 year, and way lower by 5 years. This would mean rates are going to go up steeply in the 3rd to 4th year, then drop down to 3% or something rediculous in the last year or so. I think this points to the fact that their 5 year is actually a decent bargain, and their 4 year is their standard projection of rates, with a little fat built in.

        My take on it is this. They've been able to profitably predict 5.5-5.75%, but then remembered all the times they forgot to pass on rate cuts, and realised even at this promotional rate, they'll still make decent money on this. Add to this the times people are forced to pay break fees etc, lack of offset etc, and they'll probably still do OK. Then add that you'll be locked into CBA for 5 years, at a time when consumers have no fear of rate rises, and are perfectly happy to jump banks when someone offers another 0.1% discount than what a big 4 can offer.

        All that said, now that a big 4 is offerring this rate, it's pretty likely the others will follow suit sooner than later.

  • Islund on 23/07/2014 - 15:07
    +4

    If you want shitty customer service feel free to lock yourself in for the next 5 years.

    The 4.8% is only 1.1% off their standard varaible rate - it may be better to negotiate a 1.1% discount off their standard variable rate for the life of the loan instead?

    This way you have the flexibility to jump ship.

  • Ozvalue on 23/07/2014 - 15:17
    +3

    I keep saying…. Anytime now before the Interest rates go up……… Still waiting.

  • ronnknee on 23/07/2014 - 15:23
    +10

    I think the additional fees are worth noting:

    Rate Lock fee
    There is a $750 fee for each Rate Lock (only available for 1-5 Year Fixed Rates).
    Establishment fee
    The establishment fee is $600.
    Loan Service fee
    The monthly loan service fee is $8.

  • ozultimate on 23/07/2014 - 15:35
    +2

    Good rate I'm also planning to fix my IP
    I need to clarify few things with the bank

    1. Break cost if I refinance/pay off loan considering interest rates went up.

    2. Tap into equity without any extra charges.

    • JetLi on 23/07/2014 - 15:58
      +1

      Those are good points to clarify, generally banks make a killing on break costs.

  • Cluster on 23/07/2014 - 15:44
    +25

    I think CBA is being extremely cheeky here. They got headlines about offering the lowest ever rate at 4.99% fixed for 5 years. Great!

    BUT…

    Rate Lock fee
    There is a $750 fee for each Rate Lock (only available for 1-5 Year Fixed Rates).

    Establishment fee
    The establishment fee is $600.

    Loan Service fee
    The monthly loan service fee is $8.

    The 4.99% is not a comparison rate. It's 5.62%. UBank's old offer of 5.08% (comparison rate) is far superior.

    https://www.ubank.com.au/products/home-loans#rates

    CBA's offer gets even worse without a 'Wealth Package'

    There is one very good thing about CBA's latest offer: they are expecting interest rates to stay stable or even fall slightly for the next few years. That means it's a great time to have a variable rate mortgage (at around 4.6 to 4.8% comparison rate) because you know the banks are betting rates won't be rising any time soon.

    The moment to worry about variable rates is when banks start lifting 3 and 5 year fixed rates.

    • eye on 23/07/2014 - 16:32

      Are these fees still payable if you have wealth package? We have this package and it is awesome. gives extra rates discount and no fees for any refinance or change.

      • Cluster on 23/07/2014 - 16:36

        The Wealth Package waives the need to pay the establishment and monthly fees, but the $750 fee remains, hence why the 4.99% interest rate goes up to 5.62% when calculated over the standard $150k amount over 25 years.

        • Mulga Bill on 24/07/2014 - 13:30

          I work in the banking industry.

          The confusion around comparison rates, especially for fixed loans, is that it assumes after the 5 years you will be at todays current standard variable rate (5.9%) for the next 20 years. That is why the comparison rate is so much higher (not because of the rate lock fee).

    • ozscharfschutze on 23/07/2014 - 16:43

      but you don't have to pay the rate lock fee.
      there is virtually no chance of the RBA raising interest rates in the next 90 days.

      • Richfield on 23/07/2014 - 18:19

        Nothing to do with the RBA. Rate Lock is for when the Bank changes their advertised fixed rate before the loan settles.

    • megaclix on 23/07/2014 - 19:15
      +1

      Beware that the CR of fixed rate loans can be misleading i.e. they are skewed by what variable rate is 'assumed' after the fixed rate period ends. How banks actually calculate the CR's is not readily available online.

  • rdhupar on 23/07/2014 - 16:05
    +5

    I made a mistake close to 7 years ago locking in my interest rate 7.49% for 10 years. At that time rates were close to 9% and I was laughing. But a year or so later I have only lost and lost big time. 5 years in my opinion is a fairly long time to fix but then again each to their own. 1-2 years is the max I would ever fix a loan for (thats if I ever do).

    • vid_ghost on 23/07/2014 - 16:10
      +2

      if you purchased 7 years ago your WAY ahead just on the purchase price alone! so its not all doom and gloom your property should be worth 50% more today.. best advice would be to pay down the total ASAP or SELL to try and get out of the fixed rate.

      • DryScissors on 23/07/2014 - 16:29

        You reckon? I bought 7 years ago (during the peak) and it's barely made it's way back there.

        • vid_ghost on 23/07/2014 - 16:30

          oh, i purchased an IP 7 years ago at the peak but my property went from $325k to $490k
          My other property that i live in was $329k 3 years ago and its gone up to $450k

          Sydney prices are crazy!

        • DryScissors on 23/07/2014 - 16:43

          @vid_ghost: yeah, I guessed it was Sydney going by those numbers

      • BrisLis on 23/07/2014 - 16:38

        Can selling get you out of the fixed rate without paying the ERA? I didn't think it did…

      • Cluster on 23/07/2014 - 16:44

        Using the Rule of 72 for a rough calculation, the property would have to almost double in price to make a single dollar in profit over 10 years at 7.49%pa interest. This is assuming the buyer didn't make extra repayments and lives in the property (no rental income).

    • SmiTTy on 23/07/2014 - 16:27

      thats a shame, but consider it a lesson learned i suppose :)
      think of it this way, when your 10 years is up , you'll get a "pay rise" ;-)

    • temporiser on 24/07/2014 - 20:11
      +1

      I locked in a CBA fixed rate for 7.64% approximately three years ago, as I could not afford any increases in the repayments. I would not lock in 100% again! but go for split loan

  • scud70 on 23/07/2014 - 16:14
    +2

    its not actually 4.99% the comparison rate of 5.62 and for non wealth customers its 5.72% due to the sign up and on going fee's, i take the comparison rate as the actual rate rather than the 4.99 (minus the fee's). I believe there are better deals out there even fixed.

  • aniki_xiao on 23/07/2014 - 16:18
    +2

    Big 4's fixed rate as of today:

    Term NAB (pa)ANZ (pa)CBA (pa)Westpac (pa)
    1 year 4.79% 4.79% 4.79% 4.79%
    2 year 4.84% 4.84% 4.84% 4.84%
    3 year 4.94% 5.05% 5.09% 5.09%
    4 year 4.99% 5.64% 5.59% 5.49%
    5 year 4.99% 5.79% 4.99% 5.79%

    Take your pick :D

  • cryptos on 23/07/2014 - 16:26
    +1

    Just having a loan is enough of a commitment!! Fixed just makes you their b..ch, go low end variable with no limits on repayments

  • cushydeskjob on 23/07/2014 - 16:28
    +1

    No deal. The comparison rate is what you should be comparing, not the headline rate. To use a car analogy, the comparison rate is similar to the "drive away price" whereas the headline rate is similar to the price before rego, insurance, stamp duty and dealer delivery.

    • sb944 on 23/07/2014 - 16:47
      +6

      Not 100% true. Comparison rate is only run at $150K loans. If your loan is $300K/$500K+, the comparison rates for CBA will drop, while $0 fee loans will stay the same. Also, when I was with CBA, they gave away a nice credit card, which was a better card than any free cards at the time, so you may or may not get some value from that.

    • megaclix on 23/07/2014 - 19:30
      +2

      No, you need to look deeper, as the comparison rate on fixed rate loans can be misleading. The CR rate is heavily influenced by what variable rate is used when the fixed period ends. But which variable rate do they use? Their standard variable, or discounted variable?

  • merchant_0312 on 23/07/2014 - 16:32
    +3

    Wow I am overwhelmed to see the discussion on my first bargain post ;)

    I think there are some good comments above supporting why one should not fix. But there are some undeniable positives to it.. I have already mentioned the biggest one.. which is locking into A set payment.
    This may not be important to most but will be top priority for some.
    For example, if you are going to have children soon and you will be down a single income for a period of time.. then it is always a good idea to have a set budget.. and the biggest cash outlay in most folks' monthly expenses is the mortgage repayment.. a 1% increase on a $500k variable loan could mean additonal $500 a month.. so a) if you have strong belief that rates wont increase by that much over 5 years then sure, shouldnt lock in and b) if you can easily fork out an extra $500 a month should the rates go up then again, sure dont fix..

    but in today's market where most people are stretching their budgets (specially in Melbourne) to buy a house.. then a $500 increase could be painful..
    locking in for 3-5 years just enables you to grow your income BEFORE your expenses go up..

    But the catch- needless to say- if for any reason you need to break the loan.. costs could be very high.. Note- could be high.. not that they will be high for sure..
    so if u plan to sell the house in during your fixed period.. again not the best idea to fix..

    The irony in me posting this deal is that I recently switched to Bank of Melb after being with CBA for 4 years.. I moved since they wouldnt match the 3 year rate I was getting from Bank of Melbourne..

    • vid_ghost on 23/07/2014 - 16:36

      I'm happy to support my partner 100% when i get one.. They don't need to ever work if they dont want too.

      • tikei on 23/07/2014 - 19:29
        +4

        I was going to say good on you, but after seeing your display pic I started wondering if by 'support' you mean have them in a cage and feed them twice a day lol

        • vid_ghost on 23/07/2014 - 19:35

          lol, Two meals and shelter for FREE!! .. That's almost a new bargain post in itself!

  • fbzbenny on 23/07/2014 - 16:38
    +8

    Whoa, a home loan? Us OzBargainers don't have that kind of cash. :P

    • cowiie on 24/07/2014 - 09:10

      Us OzBargainers don't have that kind of cash.

      Exactly, that's why we have home loans and do not own our houses outright.
      AND cause we keep buying cheap items that pop up regularly on this site…

  • DryScissors on 23/07/2014 - 16:46

    Also, despite what the dude said above, it's usually not worth the hassle of refinancing. Just call your bank and quote another bank's rate from cannex.com.au. Say you're looking to switch- I got a call back from CBA within two days saying they'd lower the rate.

  • ilostnemo on 23/07/2014 - 17:18

    I'm with CBA, you should be able to waive all those fees when you get the Wealth Package (it costs $350)

    Just a few points

    The offset on a fixed loan account is piss poor IIRC its like 2%

    Those who believe the bsanks' know what the next movement will be "Dream On", miles to many factors.

    I am paying 4.9% variable, but If I was getting a home loan, I'd be all over this. The interest rates can't move much lower and even if they did I'm sure the banks wouldn't pass it on, I believe the Reserve Rate is 2.5%.

    10K is the most you can repay in additional funds.

    • Cluster on 23/07/2014 - 17:28
      +1

      Banks do sometimes get forecasts wrong. I locked in a 7.3%pa 5 year term deposit with RaboBank 4 years ago because I believed rates would go down while most pundits and media outlets were forecasting them to keep rising. I know of one person at work who locked in 50% of their mortgage in 2008 at 9%pa because they feared further rates increases.

      I think CBA's latest price move is not an indication that rates will be falling further, but a general belief that rates won't be going up any time soon.

      Looking ahead over the next 2 to 3 years, the Australian economy has to absorb tens of thousands of job losses associated with car manufacturing ceasing. Think of all the parts suppliers that will need to sack workers. It's very difficult to see a scenario where the RBA feels it must start raising rates because the economy is overheating.

  • uccoffee on 23/07/2014 - 17:40
    -1

    all banks give you headache when you switch back from fixed to variable. eg: you dont get max discount, and they will try to get you to fix for another period etc.

  • [Deactivated] on 23/07/2014 - 18:47
    -2

    As a broker, i'll personally give anyone $500 cashback if they refinance $200K or more with me using this offer.

    Message me for more details.

    *Conditions apply

    • TomGum on 23/07/2014 - 20:10
      -1

      Thats $400 per year x 5 = approx $2000 income over 5 years per customer.

  • lknight on 23/07/2014 - 18:47

    cool. looks like rate rise is not due anytime soon. party time!

  • donnyta on 23/07/2014 - 19:02
    -1

    if house prices are going down who care what ever rates they give

    • donga100 on 23/07/2014 - 19:21
      +1

      Even if house prices were going down you would still need to pay your mortgage unless you planned on declaring as bankrupt.

  • MelbBargainChaser77 on 23/07/2014 - 19:02

    The headline rate is irrelevant. Its all the other greedy addons by CBA and other big 4 banks thats makes them uncompetitive. Comparison rate is neither good or bad….

  • mlburnian on 23/07/2014 - 20:39

    If ur on the wealth package the comparison rate would be lower? Also, is the rate lock mandatory?

    • [Deactivated] on 23/07/2014 - 21:34

      No

      • mlburnian on 23/07/2014 - 22:13

        no to both?

        • [Deactivated] on 24/07/2014 - 09:47

          rate lock is not mandatory, however is the only way to guarantee the rate. Wealth package reduces the interest rate, so if you where not on it you would not get 4.99% and the comparison rate is much higher, eg 5.90%.

  • JuryWheel on 23/07/2014 - 21:27

    Would have thought some ozbargainers would consider investing in the housing market at the moment not a bargain. Anyone got any opinions on the recent suggestions that you are now better to rent and invest rather then buy? If the rental market here was more stable/reliable I would be all over it.

  • virtualds on 23/07/2014 - 22:26

    Does anyone know about international banks are entering in the country soon scaring big 4 banks. That was on news few weeks ago. Anyways, 5 years are too much unless you are sure to live in more than 5 years.

  • robb6014 on 24/07/2014 - 08:06

    Wouldn't do this for my PPOR (saving heaps with ubank) but tempting for an investment.

  • cumova on 24/07/2014 - 08:37

    FYI if banks are dropping their long term fixed rates, this means they are expecting the cash rate to fall.

    • AssociatedBrianqpr @ Commonwealth Bank on 24/07/2014 - 10:08

      correct, but they get this stuff wrong frequently.

  • mauxmee on 24/07/2014 - 09:28

    just read today's AFR, the fix home loan is funded by "swap" which was 3.1-3.2% these days, that's why banks can afford 4.99% fix home loan…

  • Duram on 24/07/2014 - 09:53

    This really isn't a "bargain".

  • redlover on 24/07/2014 - 09:57

    I don't see this as a bargain.
    I got 4.99% variable with them

    • AssociatedBrianqpr @ Commonwealth Bank on 24/07/2014 - 10:07

      which might go up. A fixed rate will not.

      I would be extremely surprised to see variables rates stay below 5% for 5 years. Has that ever happened before in Australia?

      • redlover on 24/07/2014 - 10:10

        still not a bargain. many other lenders can do better than that

  • AssociatedBrianqpr @ Commonwealth Bank on 24/07/2014 - 10:03
    +1

    Those who think the banks 'know' what will happen to interest rates and therefore cannot lose. Have you ever looked at so called experts forcast things like interest rates, share markets, the Aus dollar etc? They get it wrong all the time.

    A few years ago when rates were higher I fixed for 2 years at 7.24%. No judgement on rates, my wife was going on maternity leave and we wanted certainty. Was on the brink of fixing for 1 year and then spoke to my wife who said "why not 2 years?" as the rate was more or less the same. My wife has about as much interest in finance as I do in high street shopping.

    We saved a packet in that second year as the RBA were ramping up rates to curb inflation. When the fixed rate ended our variable went back to over 9%. However the GFC started to hit almost immediately and rates then fell quickly.

    An example of how a decision with no attempt to forecast rates ended up winning against the bank "experts".

    Its all guesswork but rates are at historic lows right now. I'm currently fixed at 4.79% for 3 years with CUA, but would be very attracted to any 5 year deal at under 5% if I wasn't. CBA won't be the only lender to offer such a deal.

    • MelbBargainChaser77 on 01/08/2014 - 00:27

      So what is your comparison rate? Id hazard a guess at 5.25% The 4.79% headline rate you quote is both an innacurate and irrelevant descrpition of what you are really paying.

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