7gcbc a question.
In your (excellent) linked article it mentions '30 year fixed mortgages'. This would seem to be the norm in the US, why not in Oz?
It has always struck me as a little unfair of the banks that if you sign a mortgage contract at say 6.5% it then wanders up ,and occasionally down, but mostly up. If you want a fixed % loan it can only be a short term thing in Oz....up to say 5 yrs.
My question is why is it unreasonable to expect that if I borrow at 6.5% then my interest rate remains at that level for the life of the loan? Similarly if someone else borrows at 5% a year later or 10% 5 years later. I realise people would whinge that they were 'losing' out if interest rates went down but not near as many people would lose their homes when the interest rates inevitably rise over time.
It's clear why interest on saving varies but it seems interest rate variation on loans is just a windfall for banks.