Fixed rates still en vogue with borrowers

February 07, 2014
Nicole Spiteri

Fixed rates still en vogue with borrowers

While the number of borrowers taking out fixed rate mortgages dropped slightly in January, demand for this type of product is still sitting at record highs, according to new home loan approval figures from Mortgage Choice.  

The latest research found fixed rates accounted for 27.43% of all loans written throughout the month of January – 5.63% lower than the month before.  

Local Mortgage Choice franchise owner, Des Nation said while fixed rate demand had fallen slightly over the course of January, this type of product continued to be very popular with borrowers sitting at levels not seen since 2008.  

“If we look back at the last 10 years, on average, fixed rates accounted for 17.63% of all home loans written. So, the demand we are seeing for this type of product is currently sitting almost 10% higher than the long term average,” he said.  

According to Des, demand for fixed rate products is likely to remain strong, especially as more lenders sharpen their rates in this area.  

“During January, we saw several lenders cut the interest on their suite of fixed rate products. Most notably, National Australian Bank trimmed their four year fixed home loan package rate to 5.44% - a 20 year low,” he said.  

“All of Australia’s lenders are competing very aggressively on price within the fixed rate arena, and while this is happening more borrowers will opt to fix their mortgage.”  

Further, Des said borrowers are increasingly flocking to the safety of fixed rate home loans as it provides them with certainty around their mortgage repayments.  

“In the current economic environment and with the Reserve Bank keeping its cards close to its chest, it is not surprising to see a large percentage of borrowers opting for the safety of a fixed rate home loan.”  

Across the country, fixed rate products proved most popular with NSW borrowers, with 33.62% opting for a fixed rate home loan in January.  Queensland was next, with 30.77% of borrowers opting for a fixed rate product, while in Western Australia, Victoria and South Australia, fixed rates accounted for 21.39%, 21.20% and 19.78% respectively.  

Overall, variable rate home loans continue to prove the most popular amongst borrowers, accounting for 72.57% of all home loans written in January.  

For more information contact Des Nation on (02) 9833 8177or visit


Note: Mortgage Choice writes one home loan every 15 minutes in Australia, equating to approx. $10 billion in approvals per year, hence it provides a clear insight into borrower preferences. The 21 year old mortgage broker has a loan book of over $45 billion.  

For further information or to arrange an interview, please contact:  

Des Nation

Mortgage Choice

(02) 9833 8177  

Important information  

This article is for general information purposes only. It has been prepared without considering your objectives, financial situation or needs. You should, before acting on the information, consider its appropriateness to your circumstances.    

About Mortgage Choice  

Mortgage Choice has sourced a home loan for well over 350,000 people since 1992. It works with all manner of property finance borrowers via hundreds of franchises.  

The company writes one home loan every 15 minutes in Australia by providing professional guidance on, and choice of, products offered by an extensive panel of leading lenders. Many of its brokers provide a broader service, helping customers source commercial and personal loans, asset finance, deposit bonds and providing referrals for risk and general insurances.  

Uniquely, Mortgage Choice pays its franchisees the same commission rate for home loans they write, regardless of rate paid by the lender a new customer selects, working in the customer’s best interests to tailor a solution to them.  

To cater to the growing needs of its customers, Mortgage Choice soft-launched in October 2012 its new financial planning business. Mortgage Choice Financial Planning will officially launch in FY14.  

The company has no balance sheet or funding risk, and consistently delivers strong profits and attractive yields. It listed on the ASX in 2004 (MOC) and is a member of the Mortgage & Finance Association of Australia (MFAA).  

Recent recognition: 2013, 2012, 2011 Australian Broking Awards Major Brokerage of the Year – Franchise; 2013, 2012 Australian Broking Awards Best Ethical/Social Responsibility Program; 2012 Australian Broking Awards Best Training and Education;  No.1 on The Adviser magazine’s 2012, 2011, 2010 and 2009 Top 25 Brokerages list; 2012, 2010, 2009, 2008, 2006 and 2005 MFAA Awards Retail Aggregator/Originator of the Year; 2011, 2010, 2009 and 2008 10 Thousand FEET Top 10 Franchise list; 2010 Forbes Asia-Pacific Best Under A Billion list.  

Mortgage Choice holds an Australian Credit Licence: no. 382869 and Mortgage Choice Financial Planning Pty Limited, a fully owned subsidiary of Mortgage Choice, holds an Australian Financial Services Licence: no. 422854. Both licences are issued by ASIC.  

Visit or call customer service on 13 77 62.

Posted in: Interest rates

Contact us today.

Additional Comments? * :