In an unstable property market where the decision to switch from a variable to a fixed interest rate home loan may seem attractive, borrowers should take a few important factors into account before deciding. These factors relate to:
- the different features associated with fixed and variable interest rate loans
- the future direction of home loan interest rates, and
- the cost of switching.
This article starts off with a brief overview of the three types of home loans, namely variable, fixed and combination. It explains their pros and cons, and provides an overview of what's happening with interest rates.
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