When Your Fixed Rate Expires
Your Options
If your current home loan fixed interest rate period is up for renewal soon, it's a great time to
review your options. So think about your goals and talk to us about your next steps.
If you'd like more information, or need help to decide, talk to us about our free
home loan check-up.
It only takes 10 minutes and can be done over the phone. We'll talk you through
your current situation and your options so you can make an informed decision. See
also the 'Managing your loan' section of our
Home Buyers Centre.
Want to roll over your loan for another fixed interest rate period?
You can roll over your loan to another fixed rate period (from six months to five
years) for no fee. You could split your home loan into different fixed rate periods
to take advantage of favourable interest rate movements. The interest rate or rates
will depend on the rates available at the time you take out your new fixed rate
term but you can talk to us about ways to put our best fixed
interest rate on hold for you.
Want to pay off some of your home loan ?
You can make a lump sum repayment when your fixed rate period expires (for no fee)
and then fix the remaining amount for another period.
Want to take advantage of future changes in interest rates?
In uncertain times, it's good to have options. When interest rates are volatile,
it may be a good idea to keep your options open. We have special ways to help you
do this - so ask us about what we can do.
Thinking of doing renovations or making a big purchase?
You may be able to top-up your home loan – it's simple and easy.
Or, you may wish to consider having some of your lending in a
Flexible Home Loan. A Flexible Home Loan is a home loan and a transactional
account in one. With a Flexible Home Loan, you can pay off your loan but then redraw
it up to your Flexible Loan's limit to get the things you want.
Also, in conjunction with a Thoroughbred Card and by paying your salary into your
Flexible Home Loan account, you may be able to use interest free periods to
save on interest payments.
Want to pay off your loan faster or save on interest costs?
Set a target each year of how much you want to pay off. Then consider the following
options:
- If you can afford it, you may want to increase the amount of your home loan repayments
For example, on a $300,000 home loan (at an interest rate of 8% p.a.) - increasing
your repayments of $1,000 by $100 a fortnight could save you $14,000 in interest
costs over 30 years
- You may want to make lump sum repayments whenever you can
For example, consider splitting your loan into a number of Fixed Interest Rate loans
with different fixed interest rate periods and look to make lump sum repayments
when each fixed interest rate period expires
- You may want to make fortnightly instead of monthly repayments – by paying
more frequently you pay a little more over the course of a year so pay less interest
overall.
Want to keep your repayments the same?
We may be able to help you keep your home loan repayments the same or reduce them
by restructuring your loan. For example, you could increase the total length of
your home loan up to 30 years.
Planning a family?
What impact will an addition to your family have on your income? You may want to
lower your repayments to account for the additional spending on baby items and day-to-day
living.
Fixing an interest rate may be the preferred option as you will have the certainty
of knowing what your repayments will be over the fixed rate period.
With a fixed interest rate loan, you may want to split your loan into a number of
different fixed interest rate loans (for example you can have a portion of your
borrowing on two year and five year periods) to spread the risk and increase your
certainty. Consider interest rate periods that fit with when you may go back to
two incomes.
When your baby arrives, a repayment holiday could help you out. A repayment holiday
allows you to put a hold on your fixed or floating home loan repayments for up to
three months (available once every two years but not available within the first
two years of drawing down your loan. Other conditions may apply). That will free
up some extra cash for the things that you need at that time. However, remember
that interest will continue to accumulate on the outstanding principal during the
holiday period.
Thinking of selling and buying a second home?
Find out how much more you can borrow – apply online for a
conditionally pre-approved home loan.
You may want to consider moving on to a floating interest rate home loan until you
have decided what you are going to do.
Alternatively, you may be able to re-fix an interest rate period now and transfer
the fixed rate loan to the purchase of another property.
Thinking of selling and paying off your home loan completely?
You may want to consider moving on to a floating interest rate loan or Flexible
Home Loan (which gives you the flexibility to pay off your loan whenever you want,
for no fee)
Contact us
Call 0800 185 185 to talk to a lending specialist, find a
Mobile Mortgage Manager near you,
e-mail us, visit our Home Buyers Centre
or come into any branch.
For information and resources, please also visit the 'Managing your loan' section
of our Home Buyers
Centre.