When you get a 10-year fixed rate home loan, you lock in the certainty of knowing that your repayments will remain the same for 10 years.
As with any regular home loan, you borrow money and you make repayments to pay off the balance as well as the interest it attracts. When you get a 10-year fixed rate home loan, the interest remains the same for the first 10 years of the loan term regardless of whether interest rates increase or decrease. This means your repayments will stay the same for the whole time. After the 10 year term, the loan changes to a variable rate.
While most variable rate home loans enable borrowers to make extra repayments, this is not the case with fixed rate loans. Even if a fixed rate home loan allows you to make extra repayments, there's a good chance that it comes with an annual maximum extra repayment cap of between $10,000 to $25,000.
To make sure you get a great deal on a 10-year fixed rate loan, pay attention to the rate, the fees and the loans' features.
Focus on the following:
The longer the fixed rate term, the higher the interest rate will be. So if you decide you want a 10-year fixed rate, compare your options to find a lower one.
When some loans come with multiple fees and others almost none, a low-fee loan is a no-brainer.
A lower interest rate is more important, but low fees are another way to save on your loan costs.
Fixed rate loans have fewer features than variable rate loans, like 100% offset accounts or the ability to make extra repayments. But some do, so it's worth comparing. Especially as you won't be moving onto a variable rate any time soon.
Taking out a 10-year fixed rate home loan requires you to think hard about the 10 year period because unlike a year or two, 10 years doesn't just rush by. If you think you might move within the next decade, you'll have to exit your loan before its fixed period comes to a close, so it’s best you avoid taking a fixed rate loan in such a scenario.
If you're not sure about how your finances might look in the years to come, avoiding locking in an interest rate for the longest possible duration is a good idea.
At the end of the 10 year period your loan will usually revert to the standard variable rate offered by your lender. Alternatively, you can elect to fix your home loan for another fixed period, which may be 10 years or shorter depending on what your lender offers.
Yes, some loans allow you to split the loan amount so one portion attracts a fixed rate and the other portion attracts a variable rate. This allows you to benefit from both rates and at the end of the fixed rate term period, the entire amount attracts a standard variable rate.
When banks offer fixed rate loans they have to factor in the risk of interest rates dropping in the future, and this is essentially why they attract higher interest rates. Besides, these loans also offer borrowers the convenience of fixed repayments.
Save on interest rates and enjoy tax savings with fixed rate interest in advance home loans.
Thirty year fixed rate home loans are a great way to lock in a great interest rate for the entirety of your loan but Australia doesn’t currently offer this lengthy loan option.
If you are looking to invest or you want to reduce your repayments, you may want to compare fixed rate interest-only home loans.
The secret to minimising interest on a fixed rate home loan.
Early repayment adjustment, also known as a break fee, is charged when you end a fixed loan contract. Learn how banks calculate these fees.
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Are there any 10 year fixed interest rates for an investor prefer interest only but i believe this is now not available must be p&i
Hi John,
Thanks for your question.
We currently don’t feature a list of lenders that offer 10-year fixed interest home loans for investment.
Alternatively, you may consider fixed-rate home loans. You can use our “advanced search” filter on the page to customize the listed lenders. The maximum term for a fixed-rate investment home loan that I can find on the page is 2 years.
If you need assistance in finding a suitable home loan option, you may also get in touch with a mortgage broker.
Cheers,
Anndy