Bank of Melbourne Fixed Rate Loan

Features

The Fixed Rate Home Loan from Bank of Melbourne allows you to fix your home loan interest rate for a period of one to five years so you will know exactly what your repayments will be, however the offered fix rates are moderate to moderately high for both owner-occupiers and investors.

Additionally, following the fixed period, your interest rate will revert to Bank of Melbourne’s standard variable rate, which comparatively is a high interest rate.

However, there are some added benefits offered through the Fixed Rate Home Loan including the ability to make either principal and interest or interest-only repayments that can help reduce the burden of paying the high variable rate for a certain period of time – and is a great option for investors.

Lenders mortgage insurance can be avoided on this loan with the family guarantee option if you’re making less than a 20 per cent deposit on your property through securing your loan against a portion of the equity in the property of a family member.

You can also split this loan with another offering in order to take advantage of both a variable and fixed rate. And, to guarantee your rate the rate lock feature allows you to lock in your fixed rate during the settlement period so you can secure the rate that is advertised at the time you apply.

You have the option to take a repayment pause for if you have a leave of absence from work, the duration and your eligibility has to first be approved by the Bank of Melbourne.

Early repayments are allowed for this loan and you will not be charged any penalty fees when your loan is under a variable rate, and there is a maximum amount of early repayments you can make during your fixed term. If you go over this amount, you will have to pay a break cost fee.

Although there is no 100 per cent offset account offered with the Fixed Rate Home Loan, you can have a partial offset facility to help reduce the interest payments on your loan through the balance of a savings account.

The Fixed Rate Home Loan can also be packaged with the Bank of Melbourne Advantage Package from which you would receive discounts on your interest rate and fees, with added benefits on Bank of Melbourne financial products. However, there is an annual package fee which might outweigh some of these discounts and benefits if they are not products you think you’ll utilise.

Who is the Bank of Melbourne Fixed Rate Loan good for?

Suitable for owner-occupied and investment properties, the Fixed Rate Loan is good for borrowers who want to lock in a fixed interest rate for a specified period of time with the ability to make payments only towards the interest payable on the loan for a few years, and have the option of repaying this loan early through making additional repayments.

Review - What RateCity says

The Fixed Rate Home Loan has a range of features to benefit borrowers from first home buyers up to seasoned investors.

However, the overall cost of this loan could add up to be quite high compared to other fixed rate options on the market with its higher rates and large amount of fees.

It’s a good idea to weigh the pros and cons of this loan and check them against your needs to see if this mortgage meets all of your criteria, at the right price.

Bank of Melbourne Fixed Rate Loan Options

More information about the home and investment property Fixed Rate Loan options from Bank of Melbourne can be found at the links below.

Pros
  • Family guarantee option.
  • Loan split option.
  • Repayment pause available.
Cons
  • Reverts to a high variable interest rate.
  • Entry, exit and ongoing fees.
  • No 100 per cent offset account.
Eligibility

Must be able to provide proof of income.

Must be over 18 years of age.

Must meet serviceability criteria.

About Bank of Melbourne

Based in Melbourne, Bank of Melbourne has many branch locations throughout Victoria and a vow to serve the local community and economy. Customers have access to banking and customer service in-branch, online and over the phone.

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