Banks have been competing on short-term interest rates, with one of the bigger lenders offering a special 12-month deal of 4.35%. February through April is traditionally when major lenders will offer special interest rates—to make the most of what is a peak time to buy or sell a home.
Reducing short-term interest rates is a quick way for banks to turn the heads of borrowers and secure new business.
Our advice is to not put all of your eggs into the short-term basket. It can be tempting, but it’s always best to spread your risk, and portion out your mortgage over different terms—think 1 year, 2 years and 3 years. Also think about other factors such as short and long-term personal goals and plans, and whether the bank's products suit your financial framework for getting the loan paid off quicker.
Talk to us about what is happening with rates in the background, whilst there have been 1-year specials around 4.35%, we have in many cases been getting less than the special rates depending on loan size, LVR and other circumstances. The best rates are not always advertised!
If the short-term rates have got you thinking, we’re more than happy to offer you impartial advice. Give our team a call today on 0800 000 517.