Simple Question Yet Hard to Decide

Would you fix your IP loan at 3.89% for two years OR 3.99% for three years?

Thanks

Rich.

 

Hi @Sheep112

Just depends on your needs and goals, keeping in mind once the rates are fixed, should you choose to refinance or sell there may be large break costs.

If you are looking to expand your portfolio and tap into the equity in the near future, fixing may not be as suitable.

Hard to say without knowing about the full picture.

 

This refinance is to take some money out so I would be touching these loans for awhile.

 

So what is preventing you from fixing? What pros and cons have you come up with?

 

Sorry I should have reworded my question.

Should I take a fixed IP loan at 3.89% for 2 years or 3.99% for 3 years?

I do want to fix the loan, I am just not sure if 2 or 3 years is better.

 

In your view, where will rates be in 2 to 3 years time?

 

I think it will go up a few time, especially investor loans.

Rich.

 

Consider the tax consequences of taking money 'out'
- when will you use it?
- where will you put it in the mean time?
- How will you use redraw if you fix?

 

@Sheep112 - To ask a blatantly obvious question - what rate can you get if you don't fix? How much more/less is this going to cost you over the two or three year term? Are they a better rate than your current loan? Have you modelled the alternative with a 100 BP increase (or more)?

 

Just my opinion. Employment is doing well, economy is going up. World economy is strong.
I expect 1-2 increases by the end of the year.

 

4.44% if I choose variable for investor loan.