{"id":1555,"date":"2016-02-08T11:31:45","date_gmt":"2016-02-08T11:31:45","guid":{"rendered":"http:\/\/www.prosolution.com.au\/?p=1555"},"modified":"2018-03-08T17:17:21","modified_gmt":"2018-03-08T07:17:21","slug":"should-you-choose-fixed-or-variable-rates","status":"publish","type":"post","link":"https:\/\/wealthcoach.com.au\/stage\/should-you-choose-fixed-or-variable-rates\/","title":{"rendered":"Should you choose fixed or variable rates?"},"content":{"rendered":"

With interest rates at historic lows and more talk of further interest rate cuts, many clients are wondering if they should fix their interest rate.<\/p>\n

Less flexibility<\/em><\/strong><\/p>\n

It is important to note that fixed interest rates have less flexibility than variable rates. That is, if you break a fixed rate loan, you could be up for large penalties. No one really knows how the banks calculate these penalties and after 14 years in business, I have not found any consistency or way of predicting how to calculate them. I believe that the government needs to urgently regulate these fees because it seems no one is keeping the banks honest. Suffice to say, if you fix your interest rate and then subsequently break the fixed rate term, you should expect to pay a significant fee (sometimes tens of thousands of dollars!).<\/p>\n

In this regard, if you think you might do any of the below actions, fixing your interest rate might not be the best decision:<\/p>\n