Interest Rates

[Perry]

Here We Are Again, Folks

Resurrected from my: A Year Later file

Homeowners Warned On Interest Rates
NZPA
05/01/2011

A leading bank economist is warning home buyers that current below-
average fixed term mortgage rates could start rising "quite rapidly".

Westpac senior economist Dominick Stephens said people had flocked
to the value of low interest floating rates, in the wake of the global
economic crisis and subsequent slow recovery.

Econo-mists! Bah! Humbug!

[brokerman]

Friday got 4.45% for three years for customers ANZ and Westpac. ASB wanted 4.65%. Two year money definitely firmed.

[rocket]

With what sort of cash incentive?

[brokerman]

With what sort of cash incentive?

Good ones in comparison to loan size. All Banks now have clawbacks for cashbacks, ASB/ANZ 2 years, Westpac 3 and BNZ 4

[BigDreamer]

I am going to sign my first 4 year clawback with BNZ next week. It was a bit of a shock when I saw it as I settled on 2 other properties just 5 and 6 months back with BNZ with only a 2 year clawback.

[rocket]

If someone can guide me what interest rates & cash back should I get for a $560k loan in today's market

[Nick G]

depends on term and lvr

[brokerman]

depends on term and lvr

and servicing and overall quality of application

[rocket]

and servicing and overall quality of application

term 20 yrs, servicing no issue, LVR 80%

[Nick G]

I just got 4.75 for 5 yrs. Yesterday a friend got 4.99 so I'd be aiming for 5 at a minimum. If you can get under 5 then don't worry about the loyalty stuff would be my bet.

[Viking]

Going down yet. Expect to see 3.5% in the next few months.

http://www.interest.co.nz/news/79616...-rates-below-4

[brokerman]

Going down yet. Expect to see 3.5% in the next few months.

http://www.interest.co.nz/news/79616...-rates-below-4

Hmmm, maybe. What's scary about that is most people won't take advantage and over pay, they will use the rate to buy toys and then we'll be in danger of returning to GFC mortgagee sale levels.

[Bob Kane]

MODERATOR NOTE
The post below is copied from the Speculation & Gold thread,
given the interest rates commentary at the end.

---

Tony Alexander comments on predicting future gold prices:

Another filter which I have tried strongly to encourage you to apply these past few years is that of reasonable credibility when it comes to forecasting economic and financial variables. Since the global financial crisis our economic models no longer work because of technological changes reducing the costs of searching for alternative prices and supplies of consumer goods and services and business inputs, and because how people react to changes in key things has altered. For example the responsiveness of you and I to interest rate changes has altered. Our ability to forecast things has collapsed.
In fact, here is a list of some things which people can’t forecast – meaning not just economists but everyoneelse.
 Oil prices
 Exchange rates
 Gold prices
 Interest rates
 Iron ore prices
 Share prices
 Coal prices
 China’s growth rate this year
 Dairy product prices

Do not develop a set of business, investment, or personal consumption plans which are highly sensitive to forecasts proving wrong.
In fact this is the sixth year in which we have explicitly written here that you would be foolish to develop an interest rate hedging strategy based strongly upon a particular set of interest rate forecasts coming right. Spread your risk with a range of fixed and floating rates.

http://tonyalexander.co.nz/wp-conten...ry-21-2016.pdf

[Wayne]

Going down yet. Expect to see 3.5% in the next few months.

http://www.interest.co.nz/news/79616...-rates-below-4

When they do drop again we'll see how many posts there are here on break fees etc.

[Wayne]

Hmmm, maybe. What's scary about that is most people won't take advantage and over pay, they will use the rate to buy toys and then we'll be in danger of returning to GFC mortgagee sale levels.

Unfortunately this is true because most people are stupid and financially illiterate.