Fixed or Variable Rates

Do I choose a fixed or variable rate?

The decision of which type of interest rate suits you can be one of the most difficult choices to make when financing your new home or investment. Here are some tips that may assist with your choice of selecting a fixed or variable loan.

Things you should know about fixed rate loans

Fixed interest rate loans are generally more inflexible.

The common feature of these products is the ability to lock in an interest rate, and therefore the repayment commitment for a fixed term.

These are very useful when financing property investment ventures and during times of interest rate uncertainty.

Some lenders impose severe penalties for early payout or lump sum repayments.

When considering a fixed rate loan, ask yourself these questions:

  • Are interest rates expected to increase, decrease or stay the same?
  • How long are you likely to own the property being financed?
  • Would you like the option of being able to add to your loan for renovations or improvements?
  • Do you want to make additional repayments on the loan?

Pulse Credit Union’s fixed rate loan products are simple to understand, with competitive fixed rates out to three year terms.

Things you should know about variable rate loans

The repayment commitment on a variable rate loan can change during the term of your loan in line with movements in interest rates.

However, if you need to add to your variable rate loan for any reason in the future, you will have the flexibility of doing so without penalty.

Talk it over with us.

We like to make sure that we are looking after you, our valued member, and that we are providing options that work for you. We want you to be well informed about the product you choose - that it meets your needs and expectations now and in the future. Call our Lending Office staff to discuss your options.

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