Are you prepared for rising interest rates?
Variable rate home loans still account for the majority of mortgages being written, despite the out of cycle rate increases.
According to home loan approval data, variable home loans made up 82% of all mortgages written throughout August 2018. This was an increase of 0.37% from the month before and almost 4% higher than the 12-month average.
Across the country, variable rate demand was the highest in Victoria for the eighth consecutive month. Just over 87% of borrowers in the state opted for this type of home loan.
This was followed by South Australia, where nearly 87% of borrowers chose a variable rate mortgage.
The data showed that New South Wales is still the most likely to choose a fixed rate mortgage, with more than 21% of borrowers choosing this type.
After three of the major banks decided to increase rates in the start of September, mortgage groups have suggested it could incentivise borrowers to fix their rates.
These cost increases will impact owner-occupiers, and borrowers who may have been comfortable to ride the variable rate wave, may now look to fix their interest rate in order to protect themselves against further rate rises.
The industry has praised NAB for being the only major that didn’t lift their variable rates.
It is now a good time to look at your options/rates. Including perhaps fixing some or all your loans.
Individual circumstances must always be considered, so if you would like some help in assessing your situation and determining what is available in the market place that best suits you, contact me on 0418 903 954 or donna-lee@celsiusfinance.com.au
warm regards,
Donna-Lee Parkes
Credit Advisor
Celsius Finance