Forget about rising interest rates with a fixed rate from RAMS
The RAMS Fixed Rate Home Loan could be an ideal way to protect yourself against the potential worry of rising interest rates. If you want to stick to a budget while managing your repayments, this flexible fixed rate mortgage could be for you. It may also be ideal for investors who need to keep an eye on rental cash flow without ruining their rate of return.
|Product Name||RAMS Fixed Rate Home Loan|
|Interest Rate Type||Fixed|
|Comp Rate^ (p.a.)|
|Minimum Loan Amount||$15,000|
|Minimum Loan Term||1 year|
|Maximum Loan Term||30 years|
|Maximum Insured LVR||95%|
|Mortgage Offset Account||No|
|Loan Redraw Facility||Yes|
|Split Loan Facility||Yes|
|Fixed Interest Option||Yes|
|Suitable for Investment||Yes|
|Available as equity loan/line of credit||No|
|Repayment Type||Principal & Interest and Interest Only Options|
|Lender's Legal Fee||$0|
|Ongoing Fees||$20 monthly ($240 p.a.)|
- You can make extra payments up to $25,000 without penalty during the fixed term
- You can withdraw extra funds from the mortgage using the redraw facility (minimum $1000 redraw amount)
- You can borrow up to 95% of the property value
- There is an application fee of $595
- There is a settlement fee of $275
- There is a monthly service fee of $20
- A discharge fee of $295 applies when you close your home loan account
Maximum LVR of up to 95%
You can borrow up to 80% of the purchase price of the property without having to take out Lenders Mortgage Insurance. RAMS can offer loans of up to 95% of the purchase price of the property provided you satisfy the qualifying criteria. If you're borrowing over 85% of the purchase price of the property you'll need evidence of 5% genuine savings. If you're borrowing over 90% you'll need to hold 10% equity in other residential property or income producing assets.
RAMS will also in some cases add the cost of lenders mortgage insurance, or the 'RAMS Risk Fee' as they call it, into the total cost of your loan, meaning they can offer loans of up to 98.5% of the purchase price of the property on a full documentation loan if it's owner occupied and a principal and interest loan.
Fixed terms available
RAMS allows you to choose a fixed rate term that is right for your individual needs. Terms are available for 1, 2, 3, 4, 5, or 10 years.
If you believe the interest rates might fall in a year or so, you might prefer to fix in for only a year or two. However, if the interest rates are still rising, you can protect yourself against this by fixing in for a longer term of five or ten years.
Splitting your fixed loan
There are times when you may not know which way you want to go – fixed or variable. In this event, RAMS will allow you to split your mortgage. You can choose to leave a portion of your home loan on a variable rate and fix the remaining portion.
The variable portion will still be susceptible to movements in the cash rate and may move up or down, depending on the market. Yet, the fixed portion of your mortgage will remain at the same interest rate you fixed it at the beginning of the fixed term.
Interest-only or principal and interest
You will be able to choose between making principal and interest repayments each month, or setting your payments to an Interest-Only option.
With Principal and Interest repayments, a portion of every payment you make is allocated to paying some of the interest due. The remainder of each payment will pay down your home loan balance. Every payment you make will steadily pay off your mortgage balance.
Interest Only payments only cover the amount of interest that has accumulated on the account. Payments made will not repay any of the borrowed mortgage amount.
Interest is calculated daily on the outstanding balance, so this means the interest payment may fluctuate in some months. For example, there will be 31 days interest due some months, but only 30 days interest due in others.
Fees and charges
As with all RAMS Home Loans, fees and charges will apply to your account
- Application Fee: $595
- Valuation Fee: The first valuation is free. Subsequent valuations are charged at $220
- Account-Keeping Fee: $20 per month.
- Discharge Fee: $295
- Settlement fee: $275
Flexible repayment options
Borrowers who choose the principal and interest option on their home loan have plenty of flexible repayment options. Payments can be made weekly, fortnightly or monthly.
If you have paid extra amounts into your home loan account and suddenly find you need that extra cash back again, you are able to redraw from your home loan. The minimum redraw amount allowed is $1,000.
RAMS Home Loans customers with a Fixed Rate Home Loan have the option to pay extra repayments off their balance. This can be done by nominating an extra amount to pay on top of your regular repayments, or you can transfer funds electronically into your home loan from a transaction account.
RAMS will allow you to pay up to $25,000 extra off your home loan throughout the fixed rate period. If you do end up contributing more extra payments into your mortgage throughout the fixed term, penalty fees may apply.
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