Hi ozbargainers,
I am in the market for a new loan of about >1m. Combined loan portfolio of >2m when we refinance.
Just want to know how much are you getting and what is your total loan with a particular lender.
What is your variable rate currently, which bank, what is your fixed rate, which bank? How much discount you have over the standard variable rate?
What other benefits your bank offers you?
Cheers,
gunny….
Thanks Naritas. So nothing from the major banks hey?
Hi Gunnny, for the most part, the majors aren't price competitors. That's not to say they don't have their own niches, CBA and Westpac (for example) do some excellent phone apps and online banking. Recently, however, APRA has encouraged all banks (in particular the majors) to become more conservative with their lending and this has translated to higher rates for many borrowers. For someone borrowing $1mil+ at a relatively low LVR (like yourself) you might be able to get decent pricing ad hoc, possibly 4.1%p.a on a variable. At Naritas, so far as majors are concerned, we've had a fair bit of interest in St George's 3 year fixed at around 3.99-4.05%p.a (CR 4.99%p.a.). That being said, the standard pricing from most of the majors is fairly lacklustre at present. So if you're seeking a true OzBargain 'deal' you'd be unlikely to get anything amazing from them today…naturally, this may change in future.
Hope this helps.
What are people getting from the major banks?
1.3-1.4% with the major banks is possible on this loan amount. Still more expensive than what you could get from Macquarie, Suncorp and mid-tier lenders .
Any other opinions?
Hi Gunny,
Speaking as credit advisers who regularly assist borrowers with mortgages, we reckon a competitive variable rate would have a headline interest rate of 3.89%p.a.-4.3%p.a. depending on what you ranked as being essential in your loan. Factors such as the lender being a major bank, having an offset account (or LOC) and an included platinum credit card will likely push your variable from being sub-4%p.a. to the higher end of that range.
Presently fixed rates are pretty competitive for 2 & 3 year terms. The pricing for a fixed rate from a reputable lender over that term would likely be 3.99%p.a. (or less) as a headline interest rate.
In terms of other benefits (other than offset account or cards), the most important factors would probably be customer service, government guarantee of deposit funds (i.e. an APRA approved ADI) and consistent pricing. Our general experience has been that you need to find a trade-off between these factors unless you are borrowing $1mil+ (which is on the high side for these forums). For someone like yourself (assuming your average gearing is 60-80%LVR), you'll probably be able to get a solid offer around 4%p.a. from an excellent lender. For people borrowing under $500K they'll probably have to trade off some qualitative factors to get below 4%p.a.
In terms of specific lenders, perhaps check out the home loan deals section on this site as well as the recent forums. In our experience, lenders like Suncorp, Newcastle Permanent, Hunter United, ING, Mortgage Ezy and Bank Australia have some very competitive products at present depending on how you weight your preferences.
Hope this helps.