My Fixed Loan rate has increased

Discussion in 'Loans & Mortgage Brokers' started by New Town, 21st Dec, 2015.

Join Australia's most dynamic and respected property investment community
  1. New Town

    New Town Well-Known Member

    Joined:
    8th Sep, 2015
    Posts:
    743
    Location:
    QLD & NSW
    Hi all

    Is this across the board? I expected the variable loans to go up with the APRA thing, but I also have a fixed rate loan for an IP. I've received a letter from the lender saying its going up 0.2%.

    And yes the mortgage contract says they can increase the rate etc

    Thanks
     
  2. pinewood

    pinewood Well-Known Member

    Joined:
    8th Jul, 2015
    Posts:
    155
    Location:
    Vic
    What's the point of fixing a loan if the contract still allows rate increases? Is this normal?
     
    datto likes this.
  3. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

    Joined:
    18th Jun, 2015
    Posts:
    41,672
    Location:
    Australia wide
    Did the rate increase before settlement?

    A fixed rate means the rate cannot increase. but the rates are not determined until the day of settlement.
     
    larrylarry likes this.
  4. Peter_Tersteeg

    Peter_Tersteeg Mortgage Broker Business Member

    Joined:
    18th Jun, 2015
    Posts:
    8,130
    Location:
    03 9877 3000
    Is the rate already fixed, or is it about to be fixed.

    They can't increase the rate once it is fixed, but before then they can do what they want. The letter could also be referring to the variable rate after the fixed period.
     
  5. Jamie Moore

    Jamie Moore MORTGAGE BROKER - AUSTRALIA WIDE Business Member

    Joined:
    18th Jun, 2015
    Posts:
    3,977
    Location:
    Canberra, Brisbane and Sunshine Coast
    Nope - haven't heard of it happening.

    Could there have been a 20 bps jump just before your loan settled?

    Cheers

    Jamie
     
  6. New Town

    New Town Well-Known Member

    Joined:
    8th Sep, 2015
    Posts:
    743
    Location:
    QLD & NSW
    Gents

    Thanks for the info. As an update the lender says the letter informing of the rate increase was a mistake o_O
     
    Bran and Perthguy like this.
  7. Chilliblue

    Chilliblue Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    1,605
    Location:
    Australia
    Happened once and took a few weeks before the rate lock documentation was honoured.
     
  8. Omnidragon

    Omnidragon Well-Known Member

    Joined:
    17th Oct, 2015
    Posts:
    1,693
    Location:
    Victoria
    Let me guess, you're with a small bank.
     
    New Town likes this.
  9. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

    Joined:
    14th Jun, 2015
    Posts:
    10,599
    Location:
    Gold Coast (Australia Wide)
    but only since you contacted them :)

    ta

    rolf
     
    dabbler and New Town like this.

Property Investors! Ready to Pay Less Tax? Estimate how much Property Depreciation you can claim on your Investment Property. Washington Brown's calculator is the first calculator to draw on real properties to determine an accurate estimate.