Tuesday, December 02, 2008

Interest Rates

The bank housing loan interest rate has dropped again. We have had nine mortgages in our time and we were in there up to our necks when the rate reached over 17% (it wasn't quite as bad as it sounds, different times).

Never once have we ever fixed the rate. From what have observed, each time, we would have lost as against the variable rate. Occasionally I have been asked my thoughts on the matter, and I always opine either no, or no longer than one year. While economics might be a bit like astrology, the banks employ some pretty smart people and the banks are there to make money. If they are offering a cheaper fixed rate term, then they have some good knowledge of where things are headed. This of course takes no account of the security of mind that a fixed rate offers.

But, we are about to be paying the lowest interest rate that we have ever paid and that is a good feeling. And, for once in my life, I don't have credit card debt, although with a new car pending and murmurs in the highrise about new furniture, that won't last long. Fortunately, mentions of overseas holidays have not been heard for a bit over a week.

Our computer is now five years old and I will say it has been excellent, but it does feel tired at times While I back everything up all the time, at five years old, it could just fail and we would be sure to lose some stuff, so our christmas present to each other will be a new one. Cost about $800.

4 comments:

  1. I'm a fixed rate girl, myself, given some of the horror stories of my friends having payments jump and being unprepared. I like knowing that my payment will always be the same.

    ReplyDelete
  2. Do you reckon you are ahead then Daisy?

    ReplyDelete
  3. Absolutely. If I told you the amount of my monthly payment, you would gasp in shock. I was lucky to lock in at the perfect time.

    ReplyDelete
  4. Ok, you must have jumped in at a previous economic low.

    ReplyDelete

Whenever I wish I was young again, I am sobered by memories of algebra.