Understand the important features of loans for First Home Buyers
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Choosing a fixed rate mortgage means you have the safety and security of knowing your minimum mortgage repayments won't alter for the entire fixed term of the loan.
You know your budget won't be affected by the fluctuations of the market, so while the variable mortgage rates might go up and down, you'll be safely locked into a fixed interest rate mortgage.
These days most mortgage lenders allow you to make extra repayments during a fixed mortgage term, meaning you won't be penalized up to predetermined amounts if you want to pay more than the minimum payments to help pay off your mortgage faster.
Fixed rate mortgages can also benefit investors who need to know their investment repayments won't fluctuate during an unstable market. By choosing a fixed interest rate, you know your investment is protected against rising rates and you can safely work out your budget, your cash-flow and your investment strategy.
Your mortgage broker can help you select from the best fixed mortgage options available on the market.
Some people worry that choosing a fixed mortgage means they might miss out on any interest rate cuts that might happen in the future. If this sounds like you, then perhaps a split-loan might be right for you.
Splitting your home loan into two parts means you can choose a fixed mortgage rate for one half while leaving the other half as a variable option. This way you get the safety of the fixed mortgage portion at the same time as taking advantage of any interest rate cuts that might happen in the future, but still with the safety of being able to fix the second portion at any time.
Even though it might look like rates are dropping at one point in time, can you be sure they'll still be dropping in three or five years time? Wouldn't it be great to know you can get your mortgage rate fixed at today's rate and not have to worry about what the interest rate market is doing for the next few years?
Because everyone's financial situation is different, there's no point in choosing the same option that's worked for a friend or family members. What's important is choosing the right option to suit your own individual situation and budget.
So how will you know if a fixed mortgage rate is the right choice for your mortgage and your situation?
Before making a decision about your mortgage rates, make an appointment to speak to one of our qualified mortgage brokers. Not all loans suit every borrower, so it's important to know you're choosing the right lender to suit your needs and banking requirements.
Choice Home Loans mortgage brokers have access to hundreds of different types of mortgages from more than 30 lenders, banks and online mortgage options.
For a no obligation consultation with one of our professional mortgage brokers, contact us today.