Fixed and Variable Rates Explained

How a Fixed Rate Loan works:

  • With a fixed rate loan, you get the certainty of knowing what your repayments will be for an agreed term. Fixing your interest rate means that if interest rates go up or down your repayments will stay the same.
  • For an agreed term the interest rate is fixed or “locked in”.
  • When the fixed period ends you have the option to fix your interest rate again or revert to the Variable Rate of the same Loan Type applicable at that time.
  • Offset facility not available with Fixed Interest Rate Loans (Only applicable to Home Loans).

How a Variable Rate Loan works:

  • With a variable rate home loan the interest rate can go both up and down, affecting your repayments.
  • Variable rate home loans offer more flexibility such as an Offset Facility.