Fixed-Rate Loan

A fixed-rate loan is one where your interest rate is fixed, meaning no adjustments can be made to it. This means the repayments are predictable. Lenders may offer fixed terms between one and ten years; however, most fixed rate terms are between one and five years. After this, the loan automatically becomes a variable home loan.

Variable Interest Rate Home Loan

variable interest rate home loan, on the other hand, changes in response to the Reserve Bank of Australia’s “cash rate”. Variable rates depend on the current economic climate; when inflation is getting too high, the cash rate goes up; when inflation is lower, the cash rate decreases.

Don’t know what’s the best choice for you?

Have a look at this article: Is fixed or variable better?

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