G'day All,
Just wondering what opinions are out there at the moment when it comes to Fixed Interest,
I am in the process of re structuring my loans, at the moment I have 5 loans all on Variable Interest. But part of me is thinking that there will be a few interest rate rises after the election, so I am thinking about fixing 3 of my largest loans for 2 years just to hedge my bets,
any one else opting for a different stratergy,
Hi. Well all the fixed rates appear to be going up, (although they do fluctuate) so it could be interpreted that someone does not expect rates to be staying lower for a lot longer. I could appreciate someone with a larger $$ loan or tight repayment schedule being keen to fix at this point. All the best.
I read in one of Margaret Lomas' books about the pros and cons of fixed or variable, and her study revealed that at the end of the day the difference between the two was bugger-all. I think fixed interest was the narrow winner from memory.
I guess the "sleep at night" factor comes into play with this one; it's good to know what your interest bill will be every month for several years.
A lot depends on the cashflow from the property/ies as well to affect your mindset.For some reason I think you may be right about a couple of interest rate rises after the election. I plan to stay on variable rate as I doubt if there is much to be gained in fixing. I just went and pick-up a book of my book shelf called “Wealth Wizard” by Mark Bouris from Wizard Home Loans. When disucssing this subject he makes this comment on page 80 “during all my time in the finance business, I don’t think I’ve ever seen a genuine case of a customer beating the lending market when it comes to fixed versus variable. Sure, you’ll hear stories about people “winning”, but I don’t think they planned it that way”.
Hallg
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