More borrowers are assuming additional cash rate cuts in the following months, as they resist fixing their loans, a financial comparison website has revealed.
RateCity said more than 260 fixed loans have fallen in this month alone, with 50 variable loan rates dropping as well.
ME Bank’s Head of Home Loans Patrick Nolan said “Australians remained hesitant to lock in their loans because many people expect further rate falls this year and also did not like the rigid nature of fixed rates”.
“Customers sometimes are concerned that there is not so much flexibility with fixed rate offers,’’ Nolan told news.com.au.
“Some of the banks including ourselves have changed that ... if you take out a fixed-rate loan (at ME Bank) you can pay up to an additional $30,000 (during the fixed period.)’’
Nolan advised that borrowers who are unsure of their choice to sign up for fixed rates could choose to lock in only a portion of their home loan and then leave the rest on a variable rate.
The mortgage lender recently started offering its lowest three-year fixed rate of 3.99%.
It can be confusing to know whether to get a variable rate or fixed rate mortgage, and what features are important. That's why it's important to not only check the right rates, but make sure that you're getting the right features in your home loan. Get help choosing the right home loan