Fixed home loans growing in popularity as cash rate holds (for now)

Earlier this month, the Reserve Bank of Australia made the decision to hold the cash rate at a historically low two percent, an outcome that 29 leading economists and experts in the RBA Survey unanimously predicted.

However, with rates expected to rise in the near future, borrowers are being cautioned not to become complacent. More than half of the experts surveyed by don’t foresee a rate cut in 2016. Instead, 34 percent anticipate a rate rise later this year and 52 percent forecast a rate rise in 2017.

So, what does this mean for you? There’s never been a better time to reap the rewards of the cash rate and one of the most popular ways to prolong the current rate has been observed through an increased interest in fixed home loans. For instance, traffic reveals that interest in two year fixed home loans has swelled by an incredible 95 percent over the past three months compared to the same period the year before.

Take advantage of the current all-time low rates and contemplate the benefits a fixed rate may offer you. Before committing to a fixed home loan however, be sure to peruse the conditions, as the interest rate typically isn’t the only fee you’ll be required to pay. Why not start by checking out the lowest two year fixed home loan rates available on

  1. Greater Building Society Ultimate Fixed Rate Home Loan 3.89% pa

This package has the lowest annual fee and also carries a $0 application fee. This loan will allow you to borrow up to 95% of the property’s total value, meaning you’ll only need to deposit 5%. Like all home loans over 80% LVR (loan to value ratio), you will have to pay Lender’s Mortgage Insurance. Although you will have to pay an annual service fee of $375, a settlement fee of $180 and a title insurance fee of $95, you’re also entitled to free internet redraws.
The minimum amount you can borrow with a Fixed Ultimate Home Loan is $40,000.

  1. ME Bank Flexible Fixed Home Loan 3.99% pa

This loan also carries a $0 application fee, as well as affords you the ability to make additional repayments of up to $30, 000 during the fixed term. Although dismissing set ongoing fees (such as service charges), you will be required to pay both a valuation fee and discharge fee, totaling $400. You’re entitled to repayment flexibility, scheduled either weekly, monthly or fortnightly with the benefit of being able to make $30, 000 in additional repayments. The minimum amount you can borrow with this Flexible Fixed Home Loan is $40, 000.

  1. Newcastle Permanent Fixed Home Loan 3.99% pa

For a limited time this Permanent Fixed Home Loan will waive its establishment fee of $550. You won’t be charged an ongoing service fee with during the term of this loan, however you’re unable to redraw during your fixed term (ranging from 1 to 10 years). You’ll be provided with the opportunity to make up to $25, 000 in additional repayments, although keep in mind that paying a loan off before a fixed period could result in ‘break costs’.

About Bessie Hassan

Bessie Hassan is a property commentator at, one of Australia’s largest comparison websites. She’s passionate about real estate, renovating and helping Australian’s find better.