I got some fast feedback on yesterday’s post. Turns out more people are interested in personal finance than in quantitative investing. After spending some time thinking about it and collating more data, I am changing my stance:

• “Fixed rate” (where the rate is -really- fixed, instead of pegged to the board rate which is semi-fixed) loans are the worst of the lot unless you are confident that SIBOR will spike up drastically in the next 5 years. By drastically, I mean that SIBOR (presently 0.4375%) will spike up higher than current board rates (4.5%).
• SIBOR loans are next best, but have nothing on…
• Board (also called Variable, also called Mortgage…) Rate loans.

I will not waste breath explaining why fixed rates are bad. Here is why Board Rate loans are better than SIBOR loans. This is the complete history of board rates vs SIBOR since 1987: This is nothing surprising, ......