Interest Rate Review Strategies for 2025

Well mortgage interest rates have really been the talk of the town these last few months. It’s been a while since I have seen borrowers watching the market as closely as they have in the last year!

So, I thought it might be timely to provide some basic information that might help in terms of rate reviews. 

Now many banks will send you rate options through your banking app or internet banking log in (and there you can often see what value the bank has on your house). 

We always suggest sending us the options you can see so we can check if they are competitive and add any further comments around the market or what most borrowers and other banks are doing. 

Refix time is also a good time to make a lump sum payment if you have the funds to do so. 

Depending on the bank, you can usually lock in a rate 30-60 days out from expiry. And in an environment where rates have been dropping, leaving things to the last minute has been a typical strategy. 

It pays to keep a bit of an eye on the media and what the bank Economists are saying. I think the current vibe is that rates are near the bottom of the curve, but no one has a crystal ball! 

At the time of writing (early April 2025), either the 6 month or 2-year rate special has been the most popular. 

As rates drop, try and keep loan payments the same as they were when rates were at a higher level if you can afford to. This will help you pay off principal faster as a bigger portion of the payment now goes towards principal. 

A lot of people put unnecessary stress on themselves at rate review time. It’s about small decisions over a long period of time. Sometimes you ‘win’. Sometimes you ‘lose’. But it all evens out in the end! Splitting your lending into various fixed rates, long and short can help cushion those big decisions. Also factor in your immediate goals and plans for example selling the house. 

But where you can afford to, increasing payments above the minimum is always the simplest way to pay the loan off quicker for most people. 

The upcoming Reserve Bank OCR announcements for 2025 in New Zealand are 9 April, 28 May, July 9, August 20, October 8 and November 26.

Feel free to reach out to us at Craig Pope Financial anytime with any questions.