Fixed rate or variable rate? How to get the best of both worlds?

Why would you offer your clients a split rate loan?*

Fixed rate and variable rate loans each have their own advantages and drawbacks. By choosing a split loan, clients may get the benefits of both sides while potentially reducing risk and the possible downsides of each.

The fixed rate portion of the loan delivers security as it allows your clients to lock in an interest rate for an agreed period - usually anywhere between one and five years. This protects against interest rate changes, ensuring that this portion of the mortgage loan repayment won’t increase even if interest rates do. However, the flip side of this is that your clients wouldn’t benefit from a drop-in interest rates if they change during their fixed term period.

The variable rate portion may offer more flexibility and may allow clients to take advantage of potential decreases in interest rates. They may also be able to make extra repayments to pay off their mortgage more quickly and have access to an offset account which can reduce the interest they pay.^ The downside of a variable rate is that loan repayments would increase if the interest rate goes up.

Qudos Bank can give your clients the best of both security and flexibility. They offer the ability to split their fixed rate home loans with any of their variable rate loans (except construction loans). 

Two of their most popular splits are the Fixed Rate home loan with the No Frills home loan, giving clients a great rate combination. Here are some of the benefits of splitting with Qudos.

No Frills Home Loan:

- Access the benefits of low rates and flexibility
- No bank fees
- Low variable interest rate
- Unlimited extra repayments at no cost
- Instant redraw available through online banking (offset not available for No Frills Home Loans)

Fixed Rate Home Loan:

- Security of a fixed interest rate
- No bank fees
- Extra repayments of up to $10k per year

They’ve got Broker Development Mangers across Australia and e-business Managers to help support you get that loan through for your customers. For more information about Qudos Bank visit qudosbank.com.au or call our dedicated broker phone line on 1300 380 767

Important information:

*Source qudosbank.com.au/qudos-blog-what-is-a-split-home-loan.html

Loans are subject to approval. Normal lending criteria, terms and conditions and fees and charges apply. Mortgage insurance is required for home loans over 80% and is subject to approval.

Product deposit requirements vary across Qudos Bank Home Loans. Split options must meet the highest minimum deposit amount.

^ Offset not available for the Fixed Rate portion of the Home Loan.  

Your clients should read and consider the relevant Terms and Conditions and our Financial Services Guide available on our website qudosbank.com.au, before deciding whether to obtain any of our financial products or services.