For a bond of R1mil over 20yrs, a 1% movement in the prime rate would equate to a R688 change in your monthly bond instalment.
While, on a bond of R750k over 20yrs, a 1% movement in the prime rate would equate to a R516 change in your monthly bond instalment.
Fixed Rate vs Variable Rate: The interest rate on a fixed rate homeloan does not change. The advantage of this type of mortgage is that you are protected from rate increases and your monthly payments are consistent.
The disadvantage is that you will not benefit when the prime rate is dropping.
Fixed rate will usually be slightly higher than the prime rate at the time of your application.
Repo Rate vs Prime: The Repo rate (repurchase rate)is the rate at which the reserve bank lends rands to our local banks.
This rate is usually 3.5% lower than the current prime rate.
Jibar Rate vs Prime: The Jibar rate (jhb interbank agreed rate), is used by SA HOME LOANS. While, the Prime rate is used by the Major Banks (STD, ABSA, FNB and Nedbank)