Hi all, I am looking for a calculator or formula to decide which one is better (in terms of saving) between:
Variable rate of x% with 100% offset of $w in the offset account
as compared to
2 years fixed rate of y% with no offset.
Basically what I want to know is how much different betweeen x and y that makes it worth to do the switch.
Would be better if extra payment can be taken into account during the fixed rate period.
Thanks.
Current lender doesn't have that feature … and I can't do refinancing because part of my loan is already on fixed rate.
of course you can - what are the break fees?
I am with ING in a split loan arrangement;
The bulk of my loan is fixed with the ability to repay up to $10,000 per year without penalty.
The variable loan has an offset account attached.
Sure other banks have similar features.
So my arrangement currently is half variable and half fixed. Now I am considering to put the variable one into fixed as well as the rate is about 0.8% cheaper.
Extra payment is allowed for up to $30k.
If someone comes in and offers you $4000 to refinance with then, just remember that you can't do it if you're on a fixed rate…
Part of the loan is on fixed rate and no one offers $4,000 :-)
Plenty of lenders currently offering $4k to refinance…NAB, ANZ, St George…
Three rules of banks lending:
The BANK always wins
The bank ALWAYS wins
The bank always WINS.
Cost to fix?
Term of fix?
Cost to unfix if before term of fix?
Cost to revert at end of term?
I’d be whacking as much as I could into the offset
Why not get a lower fixed rate with an offset?