Friday, December 31, 2004

Fixed Interest Rate Home Loan

Fixed Interest Rate Home Loan: "Features of Fixed Interest Rate Loans

A Fixed Interest Rate Loan is usually 1 - 2.5% more expensive than a variable rate loan. Probably the main advantage of fixed interest rate loans is the stability of knowing what your repayments are going to be for the period of the loan. This is particularly important for investors with multiple properties, especially if they are negatively geared.

It is important to realise that if official interest rates fall you may end up paying more in repayments than if you had a variable rate loan.

Fixed Interest Loans do not usually have many of the features found in Variable loans, such as repaying the loan without penalty."