So desperate are lenders to stem a borrower exodus that they are offering unprecedented interest reprieves. But it is all happening behind closed doors. | By Nicole Pedersen-McKinnon, money contributor
One of the downsides of fixed rates – apart from the risk you’ve avoided that you will end up paying over the odds – is that you cannot pay extra on a fixed-term loan. However, by paying extra into your variable mortgage you have brought your “freedom date” forward.There is something you can also do now to keep powering ahead with your loan despite rate pressures, and all you need to do is pick up the phone.
All that is being publicly announced is price slashing on basic home loan products, which do not come with offset accounts.Without an offset account yourself, you either have such a mortgage with a larger lender or one with a non-bank, online lender that cannot offer them. Either way, you could obtain an instant discount on your variable interest rate portion of your loan.
However, your fix stops you from leaving, so your best approach is to instead explain that you are a single mother who is now more strapped for cash, and you know that 1 percentage point discounts for existing customers are common.
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