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Fixed Rate Personal Loans
Fixed rate personal loans are a type of personal loan available where the interest rate is fixed for a certain term, as opposed to a variable rate personal loan where the interest rate changes with the movements from the Reserves Bank of Australia.
If you are in the market for a fixed rate personal loan, here are some advantages and disadvantages to help with your choice:
Advantages of a fixed rate
- Your repayments are guaranteed and will stay the same for the fixed period
- Your loan is insulated from interest rate movements by the Reserve Bank
- As the repayments will be the same, this makes it easier for you to prepare a more reliable personal budget for the long term
Disadvantages of a fixed rate
- One of the drawbacks of fixing your loan is that you might have restrictions of how much in extra repayments you can make. Not being able to make extra repayments means you cant pay your debt off early. If you wish to pay off the loan early you might have to pay an early repayment penalty.
- Fixed rate loans might be less desirable during periods of falling interest rates especially if variable rates fall below the fixed rate leaving you stuck with higher repayments.
Compare some of the best fixed rate personal loans from the table below.
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Monthly repayments are indicative and based on advertised rate, loan amount and selected payment frequency over nominated loan term. Rates shown are minimum available and may vary depending on your individual circumstances and loan amount.
The comparison rate is based on secured credit of $10,000 and a term of 3 years. The comparison rate applies only to the example given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees and cost savings such as fee waivers are not included in the comparison rate but may influence the cost of the loan. Comparison rates are not calculated for revolving credit products.
Consider whether this general financial advice is right for your personal circumstances. You may need financial advice from a qualified adviser. Read our detailed disclosure here.
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