Which Rate Type Is Right for You?
As we move through 2025, interest rates appear to be stabilising after several years of fluctuation. This shift has many home buyers and refinancers asking: should I lock in a fixed rate or go with a variable one? Below, we break down both options to help you make the right decision.
Fixed Rates: Pros and Cons
Pros
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Predictable repayments that make budgeting easier
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Protection against possible rate increases
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Often available with competitive introductory offers
Cons
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Less flexibility when it comes to making extra repayments
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Break fees may apply if you refinance early
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After the fixed period, loans often revert to a higher variable rate
Variable Rates: Pros and Cons
Pros
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Flexibility to make extra repayments
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Potential for lower interest rates if the market shifts down
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Easier to refinance or switch lenders
Cons
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Monthly repayments can rise if interest rates go up
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Less certainty, which can make budgeting more difficult
Which Option Suits You Best?
First-Home Buyers
Fixed rates are often preferred by first-time buyers who want certainty in their repayments during the early stages of their loan.
Property Investors
Variable rates appeal to investors who value flexibility, especially if they plan to leverage equity or make frequent changes to their loan structure.
Refinancers
A split loan, combining both fixed and variable elements, may provide the right balance between stability and flexibility.
Thinking of Refinancing?
Even a small drop in your interest rate can lead to significant savings over the life of your loan. Use our Refinance Calculator or Book a Consultation to explore your best options.