With home loan interest rates at the lowest seen in years, homeowners are wondering if it is a good time to switch over to a fixed rate.
Switching mortgages to lock in a lower rate is an assessment that should be considered thoroughly.
Is it time to switch to a fixed rate?
Follow RateCity’s four golden rules before you make a formal decision;
- Calculate your total costs to settle your current loan and sign into another one. Break costs and deferred establishment fees can be expensive. Your outgoings can easily outweigh any savings gained so take care when working it out.
- Understand the new mortgage you’re signing into. Does it have a honeymoon rate or introductory period?
- Make sure they deliver accurate calculations on the term of the home loan.
- Approach your lender to begin negotiations for a better deal first. If they don’t come to the table look elsewhere for someone that better matches your needs.