Mortgage renewal time. Floating, fixed short term, long term?

**Oakie** · 20th April 2011, 20:30

It's that time again. Rates are here http://www.westpac.co.nz/olcontent/o...ome+loan+rates

Economic uncertainty and I'm picking that interest rates will be fairly flat for a couple of years. I'm tending towards 2 years @ 6.4% but going floating for a while @ 6.24% with the option to fix when things start to move upwards has a certain appeal too.

Currently paying 8.7% so whatever we do is an improvement.

Discuss.

**98tls** · 20th April 2011, 20:33

Originally Posted by Oakie

It's that time again. Rates are here http://www.westpac.co.nz/olcontent/o...ome+loan+rates

Economic uncertainty and I'm picking that interest rates will be fairly flat for a couple of years. I'm tending towards 2 years @ 6.4% but going floating for a while @ 6.24% with the option to fix when things start to move upwards has a certain appeal too.

Currently paying 8.7% so whatever we do is an improvement.

Discuss.

Sounds ok to me,also with WP and i signed up at 6.75 for 2 years back in October,ive been very lucky so far with the longer option.

**Woodman** · 20th April 2011, 20:33

We fix ours every year. Dunno why but we always have. Won some lost some.

**steve_t** · 20th April 2011, 20:57

Currently floating at 5.25% after some negotiation. Will probably look to go fixed term in about 3-4 months. OCR tipped to go up in the last quarter as will mortgage rates. Not only will the mortgage rates go up but they will go up fast, especially the floating rate which will have to go higher than the fixed at some stage.
The difference between 6.24% floating and 6.4% 2 years fixed isn't enough to risk missing the low 2 year fixed IMO. If those were my options, I'd be looking to go fixed in the 30-60 days.

**Usarka** · 20th April 2011, 21:13

Inflation is through the roof at the moment (relatively speaking). If it wasn't for the earthquake + recession and the govt needing to stimulate the economic clitoris then interest rates would be on their way up right now.

**YellowDog** · 20th April 2011, 21:43

Interest rates are going to stay low for a while. With he state of the economy, the Govmt wont risk pushing rates up by more than 1% for a year or so yet.

My advice, float until there is an indication that world rates are starting to rise.

Could be 2 years away!

**Mully** · 20th April 2011, 22:44

Originally Posted by YellowDog

Interest rates are going to stay low for a while. With he state of the economy, the Govmt wont risk pushing rates up by more than 1% for a year or so yet.

My advice, float until there is an indication that world rates are starting to rise.

Could be 2 years away!

Yep - what he said.

We've gone for reducing revolving - smashing the living hell out of the principle at the moment.

EDIT: Simply because we kept the payments we were making at 9.2% the same. No difference to us, but a massive hit on the principle

BNZ does one called "Total Money" where your savings offset your mortgage. We're looking at that one.

**superman** · 20th April 2011, 23:21

Originally Posted by Oakie

It's that time again. Rates are here http://www.westpac.co.nz/olcontent/o...ome+loan+rates

Economic uncertainty and I'm picking that interest rates will be fairly flat for a couple of years. I'm tending towards 2 years @ 6.4% but going floating for a while @ 6.24% with the option to fix when things start to move upwards has a certain appeal too.

Currently paying 8.7% so whatever we do is an improvement.

Discuss.

If I were you... I'd go over to Kiwibank who have current variable mortgage at 5.65%. Or usually you can tell your mortgage broker at Westpac about the Kiwibank deal and they usually match it rather than lose you. And Kiwibank have a special of locking in for 6 months at 5.4% at the moment.

Don't pay 6.4% when the market is that competitive.

**Shadows** · 20th April 2011, 23:24

I know my shit and I'm floating for the foreseeable future. Long term rates right now are only good for certainty and the banks.

**Reckless** · 20th April 2011, 23:42

Tony Alexanders latest blog I get them every two weeks (I think)?

He was 100% correct when going through the latest times predicting when to fix or not to in the last mortgage rates drop we just had! If you listened to him you'd be fixed for 5 years on good % now! LOL!!
Unfortunately I missed out as my mortgage was fixed over that period. Floating now till he stops recommending not to! Although he does say fix if you can find a 2 year at 6%.

This just came in 7:30 tonight so its the latest!
Very Interesting his comments on the charges council are putting on people subdividing and why the 70K or more (its more 100K believe me I'm an architectural designer) is preventing development and restricting house construction?? Look at page 7 all donations to the authorities just for the privilege!

He's a wise man and has been almost 100% correct in his predictions for the last 3 years I've been getting this!

**Oakie** · 21st April 2011, 07:59

Originally Posted by superman

If I were you... I'd go over to Kiwibank who have current variable mortgage at 5.65%. Or usually you can tell your mortgage broker at Westpac about the Kiwibank deal and they usually match it rather than lose you. And Kiwibank have a special of locking in for 6 months at 5.4% at the moment.

Don't pay 6.4% when the market is that competitive.

KiwiBank are only marginally cheaper at those short term rates. (WP do 6 months at 5.59%). When you get to 2 year terms the rates are identical at 6.4%

**Edbear** · 21st April 2011, 08:35

Just had a chat with our account manager as we're in the same situation. She recommends letting it float but keep an eye on trends and we can fix if we feel it necessary. She also believes rates will stay stable for a while.