By mixing and matching different fixed interest periods and types of loans, we could help you build a home loan solution that meets your current as well as your future needs.

For many people, a home loan solution that keeps their options open may be better than locking their whole loan into a long-term fixed interest rate.  If interest rates fall, that strategy could mean you’re paying much more in interest than you need to.  At the same time, having your entire loan on a floating rate leaves you vulnerable to interest rate rises.  By mixing and matching, you can keep your options open.

Benefits of mixing and matching

• It can spread your interest rate risk when interest rates go up and down.  By having different fixed interest rate periods (for example, a portion of your loan on a two year fixed interest rate and a portion on a five year rate) you can take advantage of these movements. 
  
  For example, if your home loan is $200,000 you could split it into two $100,000 loans with fixed interest rate periods of two years and five years respectively.  If interest rates go up in the short term you’ve got part of your loan locked into a lower rate for five years.  If interest rates go down you can take advantage of them when your two year fixed interest rate period expires.
  
  
• You could pay your loan off faster.  By having a portion of your loan on a floating interest rate you can make the most of any surplus income (or unbudgeted windfalls) by making lump sum repayments off your loan for no fee.  That helps you pay off your loan faster and pay less in interest.
  
  
• You could reduce your interest costs.  By having a portion of your loan on a Flexible Home Loan you can reduce your interest costs.  By paying your salary directly into your Flexible Home Loan account and using your Thoroughbred Card for your day to day purchases (and paying it off in full once a month) you can reduce your loan balance for as long as possible.  That could reduce the overall amount of interest you pay.
  

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