Time to fix

Discussion in 'Loans & Mortgage Brokers' started by Perthguy, 23rd Nov, 2016.

Join Australia's most dynamic and respected property investment community
Tags:
Page 2 of 2
  1. Perthguy

    Perthguy Well-Known Member

    Joined:
    22nd Jun, 2015
    Posts:
    11,767
    Location:
    Perth
    Hope for the best, prepare for the worst. What it means for me is I won't blow my cash buffer doing something silly. I always like to keep some in reserve anyway, just in case.
     
    Perthguy, 23rd Nov, 2016
    #21
  2. Ethan Timor

    Ethan Timor Well-Known Member

    Joined:
    16th Nov, 2016
    Posts:
    154
    Location:
    Australia
    You can't usually refinance fixed loans without penalty but you can 'top up' and release equity that way ;)
     
    Ethan Timor, 28th Nov, 2016
    #22
    flyhere and Perthguy like this.
  3. D&J

    D&J Well-Known Member

    Joined:
    20th Jun, 2015
    Posts:
    127
    Location:
    Sydney
    Hi tobe, what do you mean by matching the fixed rate term? Can you provide an example?

    Thank you
     
    D&J, 28th Nov, 2016
    #23
  4. tobe

    tobe Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    1,814
    Location:
    Melbourne
    If you take a 3 year fixed rate, the interest only term needs to be the same, 3 years.
    So you get a variable loan approved with a 10 year initial interest only term., the remainder p&i. 6 months in you decide to fix for 3 years. At the end your repayments revert to p&i, calculated on the remining term, 26.5 yrs.
    The repayments are now higher than you expected and since initially getting the loan your wife is now looking after the kids full time, and you bought a third investment property. Your stuck paying p&i on an investment loan where you would prefer to pay I/o.
     
    tobe, 28th Nov, 2016
    #24
  5. Hasan

    Hasan Member

    Joined:
    5th May, 2016
    Posts:
    16
    Location:
    Sydney
    Hi Ethan, can you please explain how you can "top up" to release equity on a fixed loan? I have a fixed loan at the moment and I'd like to get some of the equity out, but the bank said I either have to wait for it to expire or pay penalty. Thanks
     
    Hasan, 29th Nov, 2016
    #25
  6. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

    Joined:
    14th Jun, 2015
    Posts:
    10,654
    Location:
    Gold Coast (Australia Wide)
    Thats right
    This is subject to being able to service with that lender for the top up, for the cashout policy to be ok, and for the valuation to come in at where its expected.

    Personally I would use the words " equity release" rather than top up, because bankers get confused.......... they think u want to top up the existing fixed rate loan.

    Topping up involves breaking the existing loan, vs equity release is a new loan for the equity release and leaving the existing loan in place untouched

    I think the OP already stated that,just wanted to make it obvious

    ta
    rolf
     
    Last edited: 29th Nov, 2016
    Rolf Latham, 29th Nov, 2016
    #26
    Perthguy and tobe like this.
  7. Hasan

    Hasan Member

    Joined:
    5th May, 2016
    Posts:
    16
    Location:
    Sydney

    Thanks Rolf
     
    Hasan, 29th Nov, 2016
    #27
  8. retire@45

    retire@45 Well-Known Member

    Joined:
    30th Jul, 2015
    Posts:
    48
    Location:
    Sydney
    Just to point out the obvious this assumes you have extra equity in that property to actually release
     
    retire@45, 29th Nov, 2016
    #28
  9. Andrew Allen

    Andrew Allen Well-Known Member Business Member

    Joined:
    20th Jun, 2015
    Posts:
    369
    Location:
    Brisbane
    I was just noticing the price of iron ore today... had a couple of enquiries from the Pilbara with people considering buying property which hasn't happened to me for a while :)
     
    Andrew Allen, 29th Nov, 2016
    #29
    Corey Batt likes this.
  10. wombat777

    wombat777 Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    3,565
    Location:
    On a Capital and Income Growth Safari
    I'm looking at fixing my PPOR loan @ 3.69% for 2 years with Bankwest. They also allow offset against 40% of the balance.
     
    wombat777, 29th Nov, 2016
    #30
    Perthguy likes this.
  11. Lacrim

    Lacrim Well-Known Member

    Joined:
    25th Jul, 2015
    Posts:
    6,196
    Location:
    Australia
    CBA just increased their rates today. Any word on NAB or ANZ?
     
    Lacrim, 2nd Dec, 2016
    #31
    Danyool likes this.
  12. Danyool

    Danyool Well-Known Member

    Joined:
    1st Jan, 2016
    Posts:
    218
    Location:
    Sydney
    @Perthguy did u lock in. Are u laughing already?
     
    Danyool, 2nd Dec, 2016
    #32
    Perthguy likes this.
  13. Perthguy

    Perthguy Well-Known Member

    Joined:
    22nd Jun, 2015
    Posts:
    11,767
    Location:
    Perth
    I have not. I am just trying to figure out finance for a build and don't want to lock in until I have the new loan so I can see how everything is structured first. Just in case I have to move things around and then fix.
     
    Perthguy, 2nd Dec, 2016
    #33
  14. Stoffo

    Stoffo Well-Known Member

    Joined:
    14th Jul, 2016
    Posts:
    5,332
    Location:
    In the Tweed
    Have also been thinking of fixing 80/20 on a few loans (4-5 yrs)
    Asked my financial institution for their fixed rates
    1 Year Fixed, 4.69% p.a.
    2 Year Fixed,4.39% p.a.
    3 Year Fixed,4.49% p.a.
    4 Year Fixed, 4.89% p.a.
    5 Year Fixed, 4.89% p.a.
    Am paying 4.1%pa P&I for an IP loan currently (3.89% for PPOR)
    (No they did not differentiate if the fixed rates are for PPOR or IP)
    I think it is time
    But looking at the 2yr rate of 4.39% i get the feeling things may get worse before they get better !!!
    Thoughts ???
     
    Stoffo, 21st Mar, 2017
    #34
Page 2 of 2