Terminating a fixed interest rate agreement
You may choose to terminate your fixed interest rate agreement and switch to a floating interest rate during the fixed-rate period.
The following are considered breaches of a fixed interest rate agreement:
- switching from a fixed interest rate to a floating interest rate during the fixed-rate period
- repaying the loan in full before the agreed repayment date
- making an additional repayment during the fixed-rate period
- transferring the loan to a new borrower
You may terminate your fixed interest rate agreement between the 6th and the 24th of each month. The Housing Bank must receive the signed agreement no later than the 24th. The change to a floating interest rate will take effect on the first day of the month following termination of the agreement.
Costs of terminating a fixed interest rate agreement
If you choose to terminate your fixed interest rate agreement, we will calculate either a premium or a discount on the loan, depending on whether interest rates have fallen or risen since the agreement was entered into. Read more about breakage costs and breakage gains.
Before you can terminate a fixed interest rate agreement, you must be up to date with your loan repayments.
How to terminate a fixed interest rate agreement
Contact the Housing Bank and we will send you a form that must be signed and returned to us by post.
When you terminate a fixed interest rate agreement, the entire loan or loan portion covered by the agreement will revert to a floating interest rate.
After terminating a fixed interest rate agreement, you must wait six months before entering into a new one.