Is the party over? Interest rate advise

Since 2011 we have enjoyed a very prosperous period of record low interest rates. But the Reserve Bank has recently hinted at possible rises when it was stated that economic stability would be achieved at the “neutral real interest rate” of 3.5 per cent; some 2 per cent higher than the current historic low figure.

Standard variable home loan rates currently sit around 5.3 per cent on average, but this would rise to over 7 per cent should official rates get back up to 3.5 per cent.

Daniel Pym, Senior Financial Broker at Loan Market suggests that people look at Fixing their interests rates to save themselves from potential hikes, “there are still many great fixed rates available and we are seeing many clients exploring this avenue to snag a cheaper loan.”

Historically the fixed rate loan has not been as popular due to their limitations, however in recent years banks have made them more flexible and “user friendly” than they once were. There is also the option of splitting a loan facility into both a fixed and variable loan.“ This is a great way to hedge your bets and get the benefits of both products. " Contact Daniel to find out more about ways to save in an uncertain environment.