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Mortgages in NZ are typically fixed for between 1 and 5 years, with most fixing around 3 years. So 95% of mortgages will always be rate adjusted in the next 3 y
by jemmyw 4y ago
Mortgages in NZ are typically fixed for between 1 and 5 years, with most fixing around 3 years. So 95% of mortgages will always be rate adjusted in the next 3 years.
- voisin 4y agoSame as Canada. I assumed it was market forces but no, it is regulated this way! Seems like a bizarre plan to make your populace less resilient to rate fluctuations.
- bombcar 4y agoThe US weirdness of 30 year fixed-rate loans that the customer can call at anytime and the bank can never call except for non-performance is substantially subsidized by the US Government. Freddie Mac and Fannie Mae or whatever they are/were take those mortgages and basically convert them into government bonds that are then sold out. Otherwise getting 2% for 30 years would be nearly impossible (and it IS impossible in many countries).
- Negitivefrags 4y agoIt makes the banking system more resilient to rate fluctuations..
- michael1999 4y agoHow do you mean it is regulated this way? RBC lists a 25-year fixed right now - https://www.rbcroyalbank.com/mortgages/mortgage-rates.html#posted-rates https://www.rbcroyalbank.com/mortgages/mortgage-rates.html#p.... It isn't competitive (9.75% vs 6.2% on a 5 year), but it's there.
- voisin 4y agoWoah, that’s strange. I just bought a house and the mortgage guy I was dealing with said anything more than 7 years is prohibited in Canada unless you go to an unregulated B-lender. Clearly I stand corrected!
- michael1999 4y agoI don’t know if they actually sell a 25, or just post a rate for some other reason. But I know I locked in for 10 my first contract.