Australian mortgage interest rates continue to set new lows, and the lowest interest rate on the market is currently 1.69% a year's fixed interest rate. (Image source: Common field)
According to the Courier Post, Greater Bank has reduced its fixed one-year mortgage interest rate to 1.69%, which is currently the lowest owner-occupier mortgage interest rate in the Australian market.However, the interest rate requires the repayment of principal and interest and is only applicable to customers in NSW, Queensland and Canberra.
Sally Tindall, Director of Research at RateCity, said that the 1.69% interest rate seemed very cost-effective, but it turned into a floating interest rate after the fixed period ended. The interest rate immediately more than doubled to 3.66%.
Ms. Tindall said: "This is the lowest housing loan interest rate we have ever seen, but please keep in mind that this interest rate period is only one year."
"After the fixed period, the loan is converted to a floating interest rate, and the interest rate rises to more than twice. However, if borrowers re-examine their loans after the first year and fix the interest rate, refinance or renegotiate, they may still get Better returns."
RateCity calculations show that if the borrower does not switch the loan after the 1.69% interest rate period expires, the loan will be overpaid by 3849 within five yearsAustralian dollar.
Effie Zaho, a wealth management expert at Canster, said that small banks are offering far lower interest rates than the Big Four, trying to win more customers in the crowded and competitive loan market.
"Today's move by Greater Bank proves that there is still a lot of competition in the housing loan sector. If you want to take advantage of these low interest rates, it is reasonable to lock in some or all of your housing loans.
"If you want to lock in a low interest rate for one year, it is very important to understand the other interest rate products offered by the lending institution, because this is what you will face after the fixed period ends, unless you are willing to switch banks again."
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