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Interest rates > Fixed rates > Overview
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What is the Fixed Interest Rate option?
This is an interest rate option whereby you are guaranteed a fixed interest rate for a specified period.
Home loan interest rates can be volatile and are often influenced by Macroeconomic factors, like inflation or currency depreciation.
At Standard Bank we do not believe homeowners need this additional pressure! That is why we have introduced the Fixed Interest Rate option that is designed to provide you with a degree of certainty by "guaranteeing" you an interest rate over an agreed period of time as selected by you.
How does it work?
The home loan interest rate is fixed (remains the same) for a specified period, regardless of whether home loan rates rise or fall. The interest rate is fixed at an agreed rate for a period of 12, 18, 24 or 36 months.
Why should I choose a Fixed Interest Rate option?
Buying a home is one of the largest financial commitments you'll ever make. Our range of Fixed interest rate options helps give you peace- of- mind when it comes to managing your finances, with an interest rate tailored to your needs.
Regardless of whether the variable home loan rate rises or falls, the fixed interest rate for the chosen period will apply.
What are the benefits to me of the Fixed Interest Rate options?
- Protection against rising interest rates
- Better budgeting and cash flow management as monthly instalments do not vary with interest rate fluctuations.
- You can still enjoy the benefits of your AccessBond and access up to 10% of your original loan amount.
It is important to note that it is your interest rate and not your monthly instalment that will be fixed. Therefore changes in your outstanding balance may affect your monthly instalment.
What options are available to me in the Fixed Interest Rate range?
You can choose how long you wish to enter into an option i.e. whether you wish to fix the interest rate on your Home Loan for 12, 18, 24 or 36 months.
When would I take out this option?
This facility would be taken up if, in your view, the interest rate will rise during the contract period.
What are the costs involved?
There is no premium payable for this facility.
What happens if I cancel my bond?
The interest rate option will end when you sell your home or the bond is fully paid up. Early termination interest will be levied if you cancel or suspend the agreement. You are required to give us at least 90 days' written notice of your intention to settle your home loan. Should you not give the required notice we are entitled to charge you the 90 days' interest in lieu of this notice.
If you take out a new Standard Bank home loan and the bond is registered within six months of the cancellation of your fixed rate, the early termination interest will be credited to your new home loan account.
What happens if I cancel the fixed interest rate option?
A penalty fee will be charged to your account, if you fixed your rate after October 2008, should you wish to terminate the Fixed Interest Rate contract prior to the expiration of this contract. This penalty fee will amount to 1.5% of the outstanding balance for the un-served period on a pro-rata basis.
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