Q&A
Rates are at an all-time low, but Victor is …
Trapped by a fixed-rate loan
Q Hi Paul. My family and I bought and moved to our new Gold Coast home in April 2018. Our mortgage is $585,000 and we have a five-year fixed-interest rate of 4.45%.
We decided to go with a fixed-rate loan, thinking on the safe side that if interest rates go up we would still be paying the same weekly repayments (around $671 a week). We both make extra repayments. My wife contributes $200 fortnightly while I contribute $75 weekly. I paid off my $10,000 car loan about three months ago so the only debt I have is our mortgage.
Two years later – and because of the current pandemic – interest rates have fallen everywhere (to a low rate of 2.27% on a three-year fixed term).
Thankfully, my wife and I are still working full time. We tried to negotiate with my lender but sadly they declined our request, informing us that under the contract we need to finish the term, which has three
