Should I float on variable or fix my home loan interest rate?

There is a common view from the financial gurus in Australia that variable interest rate rises are inevitable. From financial commentators to bank economists to the Prime Minister, the view is that during 2010 the Reserve Bank will move the cash rate up. How much? We don’t know, but the PM suggested about 1% by July. Also, banks have not discounted raising interest rates independently of RBA decisions.

What does this mean to home loan borrowers? Let’s take a look. Read More »

Picking the wrong time to fix

A review of the fixed rate loan data in the Infochoice database shows  a couple of interesting trends. Once again borrowers have picked the wrong time to fix. Average three and five year fixed rates bottomed in March and have risen quite sharply since then. Read More »

CBA tips mortgage rates to rise

Commonwealth Bank of Australia’s (CBA) competitive pricing on mortgages helped it gain 21.9% of the mortgage market in 2009, but chief executive Ralph Norris has warned interest rates could rise.

“There’s no doubt we will reprice where necessary, we have to do what’s right on a commercial basis,” Norris said during the bank’s full year results briefing. Read More »

Interest rate put on hold for fourth month in a row

Interest rates were left on hold for the fourth month in a row and signalled the end to its recent rate cutting cycle, economists said after the RBA decision to leave the cash rate at 3% on Tuesday.
RBA governor Glenn Stevens indicated monetary policy was now on a neutral footing.  Here are some of his comments:

“The board’s judgment is that the present accommodative setting of monetary policy is appropriate given the economy’s circumstances,” Mr Stevens said. Read More »

Home improvement borrowing on the rise

Refinancing is on the rise as increasing number of home owners are looking to borrow to renovate their properties. It is said that the amounts of refinancing ranged from $20,000 to $100,000. Read More »

Interest rate rise on the horizon

Coinciding with the experts’ suggestion that the worst of the recession is behind us, Prime Minister Kevin Rudd has indicated that interest rates  will  rise in the coming months. Read More »

Looking for home loan specials?

What are home loan specials?

Home loan specials can be considered as promotional offers or packages that applicants could avail when applying for home loans. Although offered by most financial institutions, not all lenders have home loan specials.

Because of the big impact of home loans on the financial situation of applicants, banks and financial institutions have crafted a way by which people could get the best deals when it comes to such loans. Thus, the birth of home loan specials. Read More »

Major bank borrowers paying too much

(source: Herald Sun)

AUSTRALIAN home loan borrowers are paying an extra $2.7 billion a year in repayments because they don’t shop around.

Despite the major banks charging higher interest rates than smaller lenders, about 90 per cent of home buyers still choose one of the more expensive big four banks, according to financial research company InfoChoice.

After this week’s interest rate increases by the major banks, more than 60 other lenders had cheaper home loan rates, the research found. Read More »

Tips On Interest Rates - Fixed & Variable Interest Rates

Variable Interest Rates

Variable interest rates in Australia are generally set against the Reserve Bank’s “Cash Rate.” This rate is used by the RBA to make adjustments to monetary policy so that such things as people’s spending capacity can be controlled. By controlling our ability to spend, the Reserve Bank and the Australian government can achieve desired outcomes for such things as levels of employment and inflation, thereby controlling the economy.They do this by adjusting the Cash Rate up or down, dependent on whether they want us to loosen or tighten our spending habits. Read More »