Home loan terms and mortgage definitions
When a Lender lends you money at a fixed interest rate, they do so on the understanding that you will make certain fixed payments for the whole of the fixed rate period. Usually the Lender arranges their
own funding position on the assumption that they will receive those payments. As a result, if you make certain changes to your loan, it will change that funding position. The Lender may make a loss from re-arranging their funding. As a result, you may be required to pay costs for breaking the fixed rate period depending on the circumstances. Download Fixed rate break costs for more information.
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