What you should know about the 'fixed-rate cliff'
Australia's mortgage market is experiencing a significant shift, with many homeowners coming off two-year and three-year fixed-rate loans onto much higher variable rates today.
As of March 2023, about 25% of fixed-rate loans outstanding in early 2022 had expired. By the end of 2023, another 40% will expire; and by the end of 2024, another 20%. This is what the media has been referring to as the 'fixed-rate cliff'.
Here are three tips if you're about to revert from a fixed to a variable loan:
- Start budgeting right now for higher interest rates
- Contact us to discuss whether you could refinance to a new lender with a more suitable fixed or variable rate
- Limit your spending to increase your chances of qualifying for a new loan
Dream Catchers Lending is an MFAA-accredited member. Feel free to book an obligation-free virtual appointment or leave us your details.
Photo by Orla