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Loan Interest Rates

A Few Key Points about Interest Rates

Buying a home can be a very exciting time for everyone involved, what with the viewing process, putting in an offer and moving in to take into account. For those keen to learn a little about interest rates and how they work, there are several factors to consider. Most relate to the way in which rates are prone to fluctuating, but we will cover the others in more detail below.


Unless you sign up for a fixed rate repayment plan, you will be exposed to fluctuations as the economy dictates. Rising prices in commodities typically result in banks and lenders needing to up their costs, and so the paying customer will usually have to cater to the extra financial support needed. On the adverse rates can decrease, too – offering customers the option to reduce their repayments for a limited amount of time, or before rates return to normal again.

Applying at the right time

Rates will usually fluctuate at different times of the year. Although there’s no way to properly predict these events, it is possible to apply while fees are low and then sign up to a fixed rate mortgage. Many lenders and brokers will be happy to extend these lower rates for a limited amount of time – especially if it means that there is a greater chance of the buyer paying off their loan.

No two customers are the same

Although rates will be presented uniformly to those that apply at similar times of the year, the way in which these sums are repaid will vary from customer to customer. Some people will want to pay back what they owe as quickly as possible, whereas others might want to stretch their repayments over a couple of decades to minimise the financial concern. The best thing to do is to cover your options with your chosen lender and you may find that paying back each week, fortnight, or month will be beneficial to your situation in specific.