A floating (Housing variable) interest rate loan may suit you if you want the discipline of making regular payments but also the flexibility to increase these and make extra payments at any time.
With this loan, there is no early repayment adjustment if you want to make extra payments. So it’s an option to consider if you want to repay all or part of your loan early.
Keep in mind your interest rate, and therefore your payments, may go up and down in line with market conditions. So if you’re looking for payment certainty, you might like to consider either a fixed interest rate home loan or have a combination of both fixed and floating.
With this loan, if you increase your regular payments or make extra payments to repay your loan early, you won’t incur early repayment adjustments.
These adjustments can be made through ASB Home Central.
If you don't plan to make any extra payments towards your loan, a fixed interest home loan may be more suitable.
A floating interest rate may go up and down in line with market conditions, meaning your payment amount will do the same. So when interest rates are low, you could benefit.
There are different repayment options to choose from. This includes a table loan, a reducing loan or interest-only.
If you want to switch to a fixed interest rate at any stage, you can through ASB Home Central. Having payment certainty might help you manage your finances.
You can drawdown your funds in one lump sum or as instalments over a 12 month period. Drawing down in instalments could be helpful if the loan is for a building project and you don’t need all the funds at once. You’ll only be charged interest on the funds you use which can help you save on interest costs.
You have the option of a single loan on a floating interest rate or you can choose to split the amount you borrow across a combination of different interest rates.
A split loan can give you both the convenience of payment certainty and flexibility.
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