hi, What is everyone's thoughts on paying a rate lock fee? Just purchased another IP and have been offered a 3 year fixed rate of 4.43%. However settlement isn't until 15/1/16. I'm worried that if the IS fed increases rates in December this will force the Aus fixed rates up. The rate lock fee is 750. Is this worth paying? Also is it tax deductable? Cheers
I'm guessing the lender is CBA based on the $750 fee? Investment loan 3 year fixed rate? If rates increase by 0.1% it's worth it over 3 years, otherwise it's a waste of money. Nobody can predict what's going to happen over the next 6 weeks.
The lender is NAB, my figures worked out the same. Basically just trying to get opinions on if fixed rates will increase between now and settlement. How often do they change? (Any brokers know?) also would this fee be tax deductable?
Does it relate solely to an investment property? If so it should be deductible as a borrowing expense - apportioned over the next 5 years.
NAB brokers's rate lock fee is 0.15% of the loan amount. For a loan of $440k it would be $660. NAB direct is 'price on request'. Ask them to reduce it or you'll go to a broker and get a better deal. Lenders adjust fixed rates outside of the RBA cycle, lenders can (and do) change fixed rates whenever they like, it's not very predictable.