Borrowers reject fixed rate loans

Australia’s biggest mortgage broking group, AFG is reporting that fewer borrowers are choosing fixed rate loans. The AFG Mortgage Index shows a dramatic decline in the popularity of fixed rate mortgages, which fell from 8.3 per cent of all mortgages lodged in June, to only 5.0 per cent in July – a fall of almost 40 per cent.

Given that fixed rate mortgages now factor in future interest rate rises, the decline in consumer interest suggests that many buyers feel they may have missed the boat in locking in low rates earlier this year.

Source: AFG