SMH April 2, 2011 Fixing the mortgage interest rate may be a smart move if, as economists expect, the cash rate moves higher by the end of the year. If they are right and the cash rate is 0.5 percentage points higher by Christmas, borrowers with a $450,000 mortgage will have to find an extra $132 a month in repayments.
”There is a big variation in lenders’ interest rates,” Andrew Willink, the founder of financial products comparator Canstar, says. ”The gap between the highest and the lowest is still very high.”
Willink says even those mortgage holders with big mortgages who do not have a view on the direction of interest rates should consider splitting their mortgage 50:50 between variable and
fixed. That way, regardless of what rates do, borrowers will never be more than half wrong.