Any help would be greatly appreciated
I am looking at refinancing an investment loan for > 500K. Currently all fixed with Wizard at 7.24% for 5 years.
I was looking at ING’s new 6.75% rate for 5 years ( no app fee or val fee, no ongoing fee, no offset account) and locking the entire loan at the fixed rate. Prior to ING coming out, I was looking at St George professional package and splitting the loan 60% fixed : 40% Variable with fixed rate at 6.95% and variable 6.57% with a 100% mortgage offset. But by my sums, we will be saving more interest by locking the rate with ING for 5 years and even with the offset account with StGeorge, if the variable rate were to go up once more, it will very likely be higher than the fixed rate with ING.
So at present I must say that we are probably going to go with ING unless someone knows of a better deal.Our broker says that the best way of debt reduction is with an offset account and I believe that to some extent. But as I said the fixed rate is almost at the level of the variable rate already, and with rates very likely to go up in the next few years ( especially if labor win the federal election) by my calculations an IO fixed loan with ING seems the way to go
Opinions would be greatly appreciatedDoesn’t sound like there is anything wrong with that loan – I am aware of this rate and it is a good one to be sure.
You won’t be able to offset your account against it though. Don’t have enough info to be able to comment on anything else. [biggrin]
Hey Stingray,
My 2 cents worth.. Your break costs will probably be chunky – check to see if your potential savings justify doing it to start with..
It’s my belief that lenders set their fixed rates with a view to making a quid, and with 3 + 5 year fixed rates sub 7% available from a few lenders (and the rest not that far away) their crystal balls are indicating their belief/s it’ll be reasonably steady as she goes for the next few years – then again, 5 years is a long way ahead..
Re the St George option, maybe consider their intro rates (5.89%V 5.99%F), after 12 months, pay their switch fee ($1k)and into their pro pack – >$500k u should get 0.7% discount on their SVR. Haven’t done the sums but might be an option.
Cheers
theloanarranger
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