Reserve Bank Holds interest rates at 2.5% for another month
Traditionally Melbourne Cup RBA meeting delivers another win for Australians by reducing interest rates but not this time. Rates are on hold for another month and all economic data is pointing to the next change being an increase rather than a decrease. Some of the major banks have already increased the short term fixed rates. So anyone considering fixing there loan should call me to discuss and if your lender has already increased we can negotiate a pricing request or look at other lender options that have the better rates still. Remember I cannot advise if you should fix that is upto you to determine. The advantages of fixing your rate is that the repayment is not going to change for the period of the fixed rate. However the downside is if for whatever reason you have large extra funds or wish to payout loan in full you maybe liable for an economic cost penalty. This figure is determined by the lender at the time of the reduction to the loan and is unascertainable. You also are limited in amount of extra repayments you can make to your loan during the fixed period. Some lenders also do not allow redraw of any amounts that have been paid over the minimum requirement. It is wise to talk it through with me and together we can work out what features suit you and then you can make an informed choice.