Interest Rates

[Wayne]

split it into 3
- float a bit (anything you think you might be able to save in a year or so)
- 1yr
- 3yr
or 3 and 5

[Leftette]

What Wayne said.

[Wayne]

Well at least he outlined the reasoning so you could put your own weighting on it.
100,000 building permits a year - builders dream.

[PTILoveYou]

Seems like a good time to recommend PT Forumites
go back and have a look at this post/thread.
Ron Hoy Fong - Will The Next Boom Be The Boom Of All Booms?

Ron's first post in that thread.

Please don't link some outdated threads to start another debate.

[absoluke]

what do you mean float anything you think you might be able to save in a year or so? do you mean pay off?

[Wayne]

what do you mean float anything you think you might be able to save in a year or so? do you mean pay off?

yes.
If you think you might get a bonus in 6 months (say) then you might want to use that to pay down some debt (better than earning interest) but you won't be able to if fixed.
I use a revolving credit for that - mostly.

[speights boy]

Just for accuracy there Wayne, you may certainly be able to pay lump sums of a fixed mortgage.
EG: I think ANZ is 10k pa, based on the start date of the loan.

IE: If a loan was taken out on 15th Jan, and you got a bonus in Dec, you could pay 10k in Dec and another 10k in Jan.

[Wayne]

that is true SB - thanks for adding that. Trying to keep it simple.
Keeping some floating also allows you to take advantage of a sudden drop - maybe your bank has a super special on the 5yr rate.

[Wayne]

Also, while you can often pay off a small lump sum on a fixed without penalty you can't get it back again - generally.
That is where a small revolving credit is handy.

[absoluke]

thanks everyone this all all very helpful. the more that is added the better decision i will be able to make. i get the feeling everyone see's rates going up enough to justify locking in long term except for what debt can be got rid of in the short term?

[speights boy]

On the other hand, some would argue this signals a hold in the rate next month.

Treasury bets on March hike

[mortgage broker]

Hey guys, just a little something I threw together

[absoluke]

so going by those stats hamish would you suggest floating may continue to be the bigger saver as in recent years?

[Davo36]

2012 was supposed to be the bust year...

[absoluke]

so davo36 will you simply keep everything floating despite what theyre saying next month? what is your plan of action for worst case scenario if rates do go up next month?