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If you're with Westpac, CBA, NAB, ANZ etc, I guess it makes no sense to lock now?

Discussion in 'Property Finance' started by jaybean, 23rd Oct, 2015.

  1. jaybean

    jaybean Well-Known Member

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    After two increases in a row, speculation seems to be (aside from greed of course) that they and APRA are paving the way for further cuts. Seems to me it would be better to wait and see before fixing any more?

    I locked down all my loans with 3 of the 4 banks that I'm with. I did this many months ago after the first rumblings of trouble in around May.

    But I have a new loan about to be finalised with NAB in the next few days, so I've missed the boat. It probably makes sense at this point to leave it on variable for now right?
     
  2. neK

    neK Well-Known Member

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    your reason for locking should not be about trying to beat the bank at their own game.
    House always wins.
     
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  3. Peter_Tersteeg

    Peter_Tersteeg Finance broker and strategist Business Member

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    As of today, none of the big 4 has increased their fixed rates, but who knows what tomorrow will bring?
     
  4. D.T.

    D.T. Adelaide Property Manager Business Member

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    I don't think fixing is ever a good idea. Over the long term variable will always provide more flexibility and will usually work out cheaper.
     
  5. Waterboy

    Waterboy Well-Known Member

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    I'd only fix if it's a bargain basement interest rate. If it's just a few bps difference it's not worth it IMO.
     
  6. jins13

    jins13 Well-Known Member

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    For me, I need the flexibility, so even if the rates are lower, it wouldn't change anything for me. If I had no plans to buy any more properties for the next 3 to 5 years than that's another consideration.
     
  7. sandyfeet

    sandyfeet Well-Known Member

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    Doesn't make sense to be scared into fixing a rate for fear of paying a few extra $$. Variable will provide flexibility but if your certain you don't need flexibility for a period of time, fixing might be an option.

    You can't beat the man
     
  8. Mick C

    Mick C Well-Known Member

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    I wouldn't fixed to "beat" the rate as per say....as per Nek's post " House always win"

    But if it's for peace of mind and forward planning/budgeting than that's fine.
     
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  9. Switchtronics

    Switchtronics Active Member

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    I remember as interest rates were dropping, "higher lending costs" decreased the standard variable rate cuts passed on by the big 4 banks. When rates dropped 1% some banks would pass on .70 or .75%. Agreed locking in rates suits matching affordability and serviceability, however if you are looking to purchase future properties refinancing can be costly. IMO with the current economic situation I wouldn't think the reserve bank will increase interest rates. Instead of just making the big 4 rich(unless you have shares in them or your rates are exceptional) there are also non bank lenders looking to do loans and some can be sourced around the 4% mark quite fair in the current market
     
  10. jpcashflow

    jpcashflow Well-Known Member Business Member

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    I think fixing your loan has its place, I have allot of customers who want there loans fixed, as they they do not like change, on a strict budget and for simple peace of mind.
     
  11. kevilian

    kevilian Active Member

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    last Friday Westpac had a "one day offer" to provide fixed rate 0.2% lower than normal rate. which may indicate it expecte RBA will drop official rate in the near future. personally I won't fix for now.
     
  12. Peter_Tersteeg

    Peter_Tersteeg Finance broker and strategist Business Member

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    Westpac just announced a 0.1% drop in 2 & 3 year fixed rates.

    We also just negotiated a discount of 1.3% for a client with total loans of about $650k in a mix of owner occupied and investment.

    I don't think Westpac dropping fixed rates has anything to do with their predictions for tomorrow at all. More likely it's because they're extremely unpopular at the moment and they're offering incentives for people to stay (I certainly haven't written any new business for them lately and have no expectations of this in the foreseeable future).
     
  13. Redom

    Redom Mortgage Broker Business Member

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    Westpac have neat little one day offers at the end of the month - not sure if it helps all that much to generate additional business.

    CBA are doing 1.30% (this week at least!) for just under 500k, O/O too. Lower SVR for now too.
     
  14. Jamie Moore

    Jamie Moore MORTGAGE BROKER - AUSTRALIA WIDE Business Member

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    Yeah it's nuts - just had 1.3% approved for $400k mix of owner occ/IP debt. Even got 1.25% for $250k

    Had to borrow $1m+ back in the day to even be considered for that sort of discounting....
     
  15. Redom

    Redom Mortgage Broker Business Member

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    Yep - seems to change week to week. Its great this week! :)
     
  16. Travelbug

    Travelbug Well-Known Member

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    So when you say 1.3% discount- what rate do you get? ie discount off what rate?

    fixed or variable?
     
  17. Peter_Tersteeg

    Peter_Tersteeg Finance broker and strategist Business Member

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    Standard Variable Rate. All discounts are indexed off that.

    Fixed rates are a different beasty altogether. Banks rarely negotiate on fixed rates.
     
  18. Redom

    Redom Mortgage Broker Business Member

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    Much easier to negotiate on variable home loans than fixed.

    Some won't discount on investment debt alone just yet (don't think ANZ have come to the table yet on this!), but i suspect thats a matter of time before they do with APRA figures showing a severe slowdown in investment lending.

    CBA generally meet major competitors on fixed rates - but most don't move on fixed rates.
     
  19. Jamie Moore

    Jamie Moore MORTGAGE BROKER - AUSTRALIA WIDE Business Member

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    No pricing from ANZ on IP loans yet.
     
  20. Jess Peletier

    Jess Peletier Mortgage Broker - Australia Wide Business Member

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    I've been getting reasonable movement on CBA fixed rates for both IP and PPOR.