Re negtoting your home loan and fixed loan options

PretaPauper on 09/02/2017 - 20:23

I am currently quite lucky to have a minimal mortgage with 2 incomes but due to looking at options of being on one income I am thinking of locking in a mortgage. I previously had an offer from ING for 3.59% which I inquired about but never followed up due to wedding plans etc. Currently we have a variable rate with Aussie and I let them know I was looking at options but have not received a call back. Any tips for getting the best deal with your current provider? I am assuming Aussie aren't interested? I have looked online and the rates seem to star at 3.65? Can you negotiate these?

Not sure if you need facts but loan value only 20% of property not other debts and 2 good incomes - hoping to use this to secure next few years so can have children stress free

Financial

Comments

  • chartparker on 09/02/2017 - 20:43

    I'm in a similar situation to you. We bought in Dec and are on 3.85 variable with ANZ on interest only. Thinking about whether it's a good idea to go fixed for the next 2 years or so. I might piggyback off the responses you get here too :P

  • ZippyRoo on 09/02/2017 - 21:01

    I'm not sure what the fixed rate is at the moment, but you can always fix just a portion of your loan, not the entire amount. Choose the shorter term so you're not locked in for a long time, that way if you sell your property or do want to pay off the loan in full, you're not penalised for trying to get out of the loan early. I think fixing for two years is pretty safe. Also, when you fix at a lower rate and the interest rate subsequently rises higher in the future, even if you try to get out of the fixed term early, you won't be penalised much. If you fixed at a higher rate, for example at 5%, and then the variable rate drops to say 4%, then it means that the bank will lose money if you leave the fixed term, so you'll be charged quite a bit for their losses. Talk to your loan manager and get him/her to get you some good deals. It really depends on the person you get. In the past we had various loans with rams, loans taken out by a broker, and the most recent loan with ANZ, and I found the relationship manager I got with ANZ to be the best.

  • PretaPauper on 10/02/2017 - 08:02

    Thanks for the advice. I have tried to talk to my loan broker but he isn't interested even though he said he was - I think he must loose commission as we only signed last year but I was clear I wanted to be non fixed and variable then but would want to consider my options.
    I do want to fix for the whole loan as the additional payments you can make would pay off a third anyway and if we had extra money to this we could save it and pay it at the end of the fixed term. I would prefer to have financial security if we dropped to one pay.

    • movieman on 21/02/2017 - 11:10

      Find a new, independant broker.

  • totalgadget on 10/02/2017 - 08:41

    There is speculation of interest rate increase by RBA with strong AUD. So these brokers are not interested to lock in because they want to maximize profit & waiting for rate increases and they show interest. So I think its good if you can lock in to fixed.

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