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  • Originally posted by Damap View Post
    I will be ecstatic if we see 5 years at sub 4% but I don't believe it either :-)
    Could you believe 12 months ago that we will have sub 4% rates for 1 year term?

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    • I am not so surprised at short term rates. Money on the shelf is doing nothing for a bank so short term money tends to be more volatile. But yes it's all pretty amazing for shore :-0

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      • Sometimes the rates look very good but what about their hidden terms and conditions such as fees, incentives they offer, etc.

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        • Plenty of their lending is not on mortgaes. Credit Cards are 20%, business is still up there around 12%.

          Originally posted by eri View Post
          as has been said here before

          the outlook is for flat

          followed by flat

          with a long term outlook of flat

          so yes

          imho

          5 years rates will fall below 3.99%

          sooner rather than later

          unless

          some currently unforeseen even happens that makes money scarce again

          but it's really hard to see what that would be

          as current economic theory suggests

          pumping more money into the economy

          is the only politically viable cure

          for any economic ill

          (including having too much money in the economy!)
          Originally posted by eri View Post
          in the long run it'll happen

          but any gains made

          will be taken by increased taxation

          in all its many forms
          Originally posted by Judge View Post
          Could you believe 12 months ago that we will have sub 4% rates for 1 year term?
          Originally posted by ivanp View Post
          As I read from the article:

          1) ASB borrowed 5 years at 4.245% - they will probably lend it at 4.99% or close, and maybe the volume they just borrowed is enough for the few upcoming months, but will be over by the time rates fall below 4% ? Then they will borrow more (at lower rates) to lend more?

          2) BNZ borrowed at 5.314%. which doesn't make any sense to me as that's above their 5-year lending rates. How do they not loose any money here? I don't understand what's going on here. Did they raise these $550m for other lending such as credit cards?

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          • Currently kiwi bank is offering 1 year fixed rate at 4.49% but I have just negotiated at 4.25% , but my bank manager says wait till next OCR announcement.
            Should I wait or fix it.

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            • yes .

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              • Definitely yes.

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                • What do you mean Wayne. Fix or wait.
                  If OCR is announced and drop another 2.5%, I don't think all bank will change their rates instantly. If they do, there won't be much different happening "sometime" .
                  What are your thoughts according to your experience. I know we don't have crystal ball

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                  • Originally posted by primal View Post
                    I know we don't have crystal ball
                    Exactly - hence the yes!
                    Odds on the OCR won't change this time (but they might - almost toss a coin territory at the moment).
                    But if it does it would be .25% down.
                    Work out what paying say 0.25% more for the year would cost you?
                    Are you not concerned about the 0.5% drop next year so only fixing for 6 months?

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                    • How do I calculate that.
                      Right now my variable is set to 5.4% and think of changing to 4.25% or less for 1 year if I get good rate . I will call bank to reduce more. Let's see what happens. They won't go below 4%

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                      • You have negotiated at 4.25% for the year.
                        If the OCR went down say 0.25% and this was reflected in the interest rate you could negotiate (4.0%) then if you fixed now you would be paying 0.25% more.
                        So if this was on $500k then it would cost you $500k x 0.25% or $1250 more if you fixed now.

                        But would the 0.25% OCR cut be reflected ifully in the 1 year rate?
                        Will the OCR drop?
                        Will the OCR drop more next year while you are fixed for 1 year therefore you'd be better fixing for 6 months.

                        All guess work - so the answer was YES.

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                        • Westpac offered me 4.29% for 1 year just earlier this week, but my bank manager told me to wait a bit longer.

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                          • I negotiated from 4.49% to 4.25% and if OCR drops it will be 4.24% but will the bank drop the rate instantly. As per the history goes it will take may be month or two before kiwi bank drops it as they are nz owned bank.

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                            • Originally posted by primal View Post
                              I negotiated from 4.49% to 4.25% and if OCR drops it will be 4.24% but will the bank drop the rate instantly. As per the history goes it will take may be month or two before kiwi bank drops it as they are nz owned bank.
                              I haven't really tracked the figures but has the 1 year rate tracked the OCR?
                              Is there a direct correlation?

                              You negotiated a .24% reduction in the current 'headline' rate so you would think you could do the same if the headline rate came down hence me saying 4%.

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                              • Guys.. I seek your advise and your opinion

                                I have 3 loans

                                1) 500k fixed at 5.65% till Dec 16
                                2) 200k fixed at 5.95% till Aug 17
                                3) 470k fixed at 5.95 till Jul 17

                                Early Repayment Recovery 'Break Fee' of respectively
                                1) $5,442.48
                                2) $5,127.07
                                3) $11,946.55

                                Bank has offered $3000 Cashback and is offering 4.25% fixed for 1 year...They dont seem to budge on waiving the break fees.

                                Thoughts?

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