What Should I Do When My Fixed Term Expires?

Is your fixed rate term about to end?

Those who managed to secure fixed rates at their lowest could be looking at a significant mortgage repayment increase depending on when their fixed term ends. This paired with rising living costs could leave many Australians stretched to their financial limit. To ensure that you and your family are prepared for this change, it’s crucial that you assess your home loan by speaking to us.

fixed rate term
fixed rate term

How To Prepare For Rising Home Loan Interest Rates In Australia

Unfortunately, there is no way to extend your current fixed rate mortgage at the same rate. If your rate is expiring soon, the best course of action is to be well informed. Take a good look at your current loan, assess whether it has been working for you, and take note of the features you currently use and benefit from, such as an offset account. 

During this assessment, you will also need to factor in your individual circumstances and future plans. If your lifestyle or financial situation has significantly changed since you first signed on for your loan, you could be better suited to a different arrangement. Future plans, such as if you intend to sell your home or buy an investment property, could also inform what type of loan is best for you.

Once you have a thorough understanding of your current situation, you can begin to prepare for the moment your low rate fixed loan expires. The good thing about your fixed term ending is that you are no longer locked in and can consider changing lenders to get the best rate available. Here are a few options that could work for you depending on your circumstances.

Refix Your Home Loan

If you prefer to have fixed rates and know exactly what your mortgage repayments are going to be each month, refixing your loan could be the best option for you. Get in contact with us, we will compare rates and find the best option for you. Keep in mind that you will need to pay a potentially costly break fee if you plan to sell or refinance within the fixed rate term.

Switch To A Variable Home Loan

A variable loan gives you much more flexibility when it comes to your repayments. For example, you can often opt for unlimited repayments, allowing you to pay off your loan at your own pace, and you can sell or refinance without needing to pay break fees. The downside is that your rate will rise with the market which can be unpredictable.

Split Your Home Loan

If you like the stability of a fixed rate home loan in Australia but also would like to take advantage of the features that can come with a variable rate, you can split your home loan between the two. Fixing a portion of your loan while leaving the rest variable can help you reduce the risk of rising interest rates without completely boxing you into a lengthy loan that may not work for you in a few years. 

What Happens If You Do Nothing?

Another option is to do nothing at all. If you wait until your fixed rate home loan expires without making any changes, your loan will likely roll over to a variable rate. This could be a financially poor decision as you’re unlikely to secure a good variable rate without negotiation – so make sure you speak to us.

Don’t Be Afraid To Change Lenders

By far the most valuable thing you can do to prepare for your fixed term ending is to see what else is out there so contact us. Our team of award-winning mortgage brokers will use their experience and industry connections to find you the best option for your lifestyle, financial situation, and future plans.

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We’ve worked with clients across Australia to access the different first home owner grants (FHOG) as well as the various stamp duty and other concessions that may be available depending on which state you are in. We can talk you through your various options as well as helping you compare things like buying vacant land vs. an established home.

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A word from our satisfied customers

Maxine Zhong
Maxine Zhong
19 October 2023
Amanda has been such an incredible support throughout our very first time going through the home loan process. Her thoughtfulness to regularly check in to make sure all our questions were answered and that all our documents were in place helped to make the whole daunting process feel seamless and easy. I could not recommend her enough - she made sure to keep us informed every step of the way and made sure all necessary documents/processes were completed well ahead of time so we never had to worry about missing any steps. She went well above and beyond her role, and I know we will definitely be coming back to her in the future, as well as recommending her to all of our networks! Thank you again, Amanda!
Mark Nesbitt
Mark Nesbitt
11 October 2023
Greg and the team provide an outstanding service. Highly recommended
Christine Tran
Christine Tran
23 September 2023
Yuval handled my first ever home loan, he did such an amazing job I asked to him to refinance for me 2 years later. Yuval made everything very easy for me, and will give his best recommendation as if it was his own. Would always recommend Yuval :)
David Petrini
David Petrini
25 August 2023
Yuval Bloomfield was an absolute delight to work with. He made it extremely easy for my clients to discuss about their financial situation. With Yuval's strong connections he was able to get the loan my clients wanted in very quick time. Will definitely refer Yuval again.
Sophie Linehan
Sophie Linehan
24 August 2023
Greg and the team at 1st Street were fantastic all the way through the process of getting our financing sorted and buying a new home. They not only secured us the most competitive mortgage in the market but they also gave advice on a number of mortgage-adjacent questions that came up along the way. Their responsive and thoughtful guidance helped make the nail-biting process clear and calm. We would definitely recommend their services.
Gabrielle Scott-Jones
Gabrielle Scott-Jones
18 August 2023
Greg and his team gave me exceptional advice and support. They were timely and detailed in their responses and dealt patiently with me as a first home buyer and all of my questions. The lender at the bank commented on how well I was being looked after compared with other brokers in the market. I’d highly recommend 1st Street to anyone, including friends and family.
Eli Simic
Eli Simic
15 August 2023
Great communication and fast service
Richard Kuipers
Richard Kuipers
11 August 2023
Jeremy and his team are superb. Negotiated the best deal for us and were an absolure pleasure to work with. Highly recommended, you can't do any better in my opinion.
Jordan Rivkin
Jordan Rivkin
1 August 2023
The team at 1st Street truly are professionals. I can't recommend Jeremy highly enough, he is extremely competent and just a great guy. You're in safe hands with 1st Street!
Yossi Bengida
Yossi Bengida
23 July 2023
Another amazing job by David and Bree. Always available for our questions, helpful and just 10/10 Seriously good work !! See you on the next one :) Yossi and liz