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UBank UHomeLoan from 3.69% p.a (CR 3.69%), Owner-Occupier Loans $200K - $700K, Refinance and Get $1000 into a USaver Account

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UBank UHomeLoan from 3.69% p.a (CR 3.69%), Owner-Occupier Loans $200K - $700K, Refinance and Get $1000 into a USaver Account
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Psteve08 on 14/04/2018 - 21:53 ubank.com.au (1993 clicks)
Last edited 14/04/2018 - 22:13 by 1 other user

Product Name UBank UHomeLoan Variable Rate - Discounted Rate — borrowing between $200,000 and less than $700,000 (Owner Occupier, P&I)
Interest Rate Type Variable
Interest Rate (p.a.) 3.69%
Comp Rate^ (p.a.) 3.69%
Minimum Loan Amount $200,000
Maximum Loan Amount $700,000
Maximum Loan Term 30 years
Maximum LVR 80%
Maximum Insured LVR 80%
Mortgage Offset Account No
Mortgage 100% Offset No
Loan Redraw Facility Yes
Split Loan Facility Yes
Fixed Interest Option Yes
Loan Portable Yes
Suitable for Investment No
Extra Repayment Yes
Available as equity loan/line of credit No
Repayment Type Principal & Interest

Refinance and get a surprise bonus $1000 into a USaver account

To be eligible for the UBank UHomeLoan, you must:

Currently be earning a Pay As You Go (PAYG) income from an employer (this excludes rent, Centrelink payments, superannuation or family payments as your main source of income).
Never have committed a financial crime or declared bankruptcy.
Be an Australian resident with an Australian residential address.

Referral Links

Referral: random (1061)

Referrer and referee each receive $10 after referee makes 5 settled card purchases within 30 days.

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closed Comments

        • DaveD on 15/04/2018 - 19:24

          Not quite, thats why precisely people have offset account

        • ely on 15/04/2018 - 22:58
          +1

          @Daved: I… think you might be slightly confused about how this works - because that's exactly how it works. If your account balance goes down then the balance of the mortgage you're paying interest on goes up.

          Your total outstanding is the mortgage less your account balances, ergo the moment you spend anything from your account balances the total outstanding increases. You might, for some reason, feel better about one than the other but they're basically equivalent in terms of interest paid if you manage it right.

          I have redraw only, but almost no cash or balances elsewhere - it's all on the mortgage. I pay for everything on credit cards, so when I spend my outstanding on the mortgage stays the same, and I just pay off the cards in full every month. If I had an offset instead I wouldn't save anything noticeable in interest (a few dollars perhaps), and if I had to pay extra for it I'd be worse off.

        • DaveD on 16/04/2018 - 06:25

          @ely: I use credit card to the most with auto payoff every month from offset account. But if you were to know exactly how much is outstanding on your mortgage today and how much are you expecting it to be after a month, its bit hard to give figures. But if you have offset account its easier, its very helpful budgetin tool…but offset will save you same interest though..(i pay 10 a month exrea just to have that budgeting tool)…but by no means i am criticizing deal here, it is outright awesome (but without offset obviously)

        • ely on 16/04/2018 - 07:35

          @Daved: The offset is easier, I guess, but as you can see from my explanation above it really won't save you any interest if you manage your redraw correctly.

          I don't get what you're saying about it as a budgeting tool; in both cases you can see what your balances are and so I don't see any difference in utility for budgeting.

          If you manage your redraw well (leave all money on the mortgage, only withdraw to pay CC bills) then you'll be no worse off. If, as you are, you pay extra for the offset facility then you're actually worse off. But hey, it's only $120/year, it's not so bad, and for many people the convenience of the offset is probably worth paying a bit extra for.

        • xyron on 16/04/2018 - 18:11

          @ely: if you ever want to use your offset savings to spend on a second property, you'll regret not paying that extra $250 a year package fee (because of tax consequences). I also prefer the idea of having the money in liquid form rather than having to make a redraw application and be at the mercy of the bank.

        • ely on 16/04/2018 - 21:09
          -1

          @xyron: Possibly true, depending on circumstances, but I'd rather shoot myself than become one of the property speculators that are (profanity) up this country so badly, so it's a bit of a moot point in my case.

          Redraw application is technically at the mercy of the bank, but in practice the process is more or less the same as any other internet banking transfer.

          I'm also not aware of any issues with redraw on your personal mortgage with regards to other, future investment properties; as discussed elsewhere in this post there are possible issues with converting the current property into an investment in the future, but that's quite a different scenario.

    • SaberX on 15/04/2018 - 12:49

      I guess redraw when you draw it out as others said bad if you want to turn it into an investment property as the money your ripping out is viewed as property or personal related.

      An offset while it is pffsetting interest to the same value i can pay bills for personal and cash out for personal reasons and because your not actually drawing cash from a paid down mortgage they wont ever assess whether it is private use which would affect the deductibility of your loan interest if you turned it into an investment property.

      • SlickMick on 15/04/2018 - 23:26

        I would never again organise loans according to future needs. If you are going to turn it into an investment property, refinance it at that time.
        Several times in the past I a made decisions based on what I might do in the future, but invariably I have refinanced several times before it eventuates.

        • Ruckmauler on 16/04/2018 - 12:57
          +1

          As has been mentioned earlier - refinance is irrelevant to the ATO - if you paid down the mortgage there aint no way to magically refinancing your way back. So get an offset.

        • SlickMick on 16/04/2018 - 16:30

          @Ruckmauler:
          sorry - I obviously haven't read all of above. Will have to come back and see what I've missed if I'm ever in this situation, because I can't see why a new mortgage on a property can't be tax deductible even if old one wasn't. Seems I'm in need of some schooling :)

  • moneyhungry on 15/04/2018 - 06:30

    1 year fixed gives you 3.59% at ubank

  • eskylidder on 15/04/2018 - 07:26
    +1

    What's the normal rate if this is "discounted"

  • Ryder on 15/04/2018 - 07:40
    +2

    The issue with Ubank is they suck you in initially with great rates but over time, you won't be receiving the best rate they offer because they jack up your rates by more than the RBA.

    • steve08 on 15/04/2018 - 07:58
      +1

      No discharge fee from ubank if they jack rates up easier to switch.

      • SlickMick on 15/04/2018 - 23:27

        that doesn't sound right. Are you sure about that, or do I need to find my paperwork?

        • steve08 on 16/04/2018 - 07:49

          Application Fee $0
          Lender's Legal Fee $0
          Valuation Fee $0
          Ongoing Fees $0 p.a.
          Settlement Fee $0
          Discharge Fee $0

        • SlickMick on 16/04/2018 - 16:24
          +1

          @steve08:
          That's really good. I think it must be fairly newish?? I hope it catches on.

          When gov banned exit fees, everyone introduced a discharge fee. They all should be illegal. I'd be refinancing quite frequently though.

    • Trying2SaveABuck on 15/04/2018 - 09:11
      +5

      Been with Ubank for over 2 years since switching ill agree they suck initially (regarding service) but you get what you pay for in life. Once the loan is settled there is pretty much no issue even if they lower there rates just call them an say i want the same as a new customer and i always got it within 7 days - my last bank charged me a fee of $96 (Bankwest) to change my rate to be the same as new customers (when rates were lowered).

    • mitchellp on 16/04/2018 - 10:56

      edited. wrong spot

  • WreckTangle on 15/04/2018 - 09:26

    Will I need to pay to supply a house valuation or will they take care of that?

  • frugalbat on 15/04/2018 - 09:48

    Does anyone have any experience with Ubank processing time ? There seems to be quite a few negative reviews https://mozo.com.au/rate-and-review/ubank/home-loan-reviews

    • cheapismymiddlename on 15/04/2018 - 10:15
      +1

      Took me neatly six months to switch. But no dramas after that!

      • No ONE on 15/04/2018 - 10:41

        Wow, 6 months is really a long time.

      • Cheemeister on 15/04/2018 - 21:43

        I'm not experienced with refinancing, but… what?!? It's not like you're submitting a DA. What is going on during those six months? What is a normal timeframe?

        • cheapismymiddlename on 15/04/2018 - 22:37

          It probably isn't a normal timeframe, they just did not follow up things like required docos, just sat on it for a while.. lol

  • rambutann on 15/04/2018 - 10:32

    I'm so confused about how this is a good deal. loans.com.au is at 3.54% comparison rate on a very similar product. You can get $150 off them with a referral code. Their service is top notch..

    • door999mo on 15/04/2018 - 11:48

      We still have people prefer using a bank than a non-bank for home loans.

      • rambutann on 15/04/2018 - 11:54
        +1

        But how on earth is uBank more of a bank than loans.com.au or reduce loans as mentioned below?

        The service that they provide is exactly the same whether they are a brick & mortar bank or an online one..

        Its not like you can pop into your local uBank…

        • Cluster on 15/04/2018 - 13:50
          +5

          Here is the key difference between a non bank lenders (loans.com.au) and UBank (owned by a bank):

          https://www.loans.com.au/how-it-works
          "Our parent Firstmac issues securities, called Residential Mortgage Backed Securities (RMBS), to Australian and international institutions and investors. "

          A bank funds loans from money markets and its own deposits. Loans.com.au funds its loans solely from money markets. That means they borrow short term (1 year or less) money and must rollover the securities into new ones regularly. During the 2008/2009 GFC short term money market rates rocketed upwards. Lenders reliant on these markets had to rapidly raise interest rates, while banks had a cushion of lower interest rate money to fund loans.

          End effect: Home loans from banks were largely unaffected. Home loans from securities based lenders rocketed upwards, and often the lenders themselves had to be sold to a real bank.

          https://www.finder.com.au/what-happens-if-my-lender-goes-bus…
          "”I think the easiest way to answer this questions is to look at what happened to RAMS at the start of the GFC. They generally got their money from big American intuitions on short term contracts to lend to Australians for home loans. Every 30-60 days they would have to refinance their entire business loans. And when the GFC hit, the American institutions had no money to invest. At first, they did not want to reinvest their money, even more of an issue was that they wanted their money back."

        • Snoopy113 on 15/04/2018 - 20:12

          Ubank is a Subsidiary of the NAB.

        • gentlecrack on 13/05/2018 - 14:06

          @Snoopy113: until they decide to sell it like their Wealth business.

  • [Deactivated] on 15/04/2018 - 10:35
    +1

    I believe that the Bank of Melbourne offer of 3.64% is better than this.

    • steve08 on 15/04/2018 - 11:06

      is a good deal from bank of melb only a Discharge fee $350. plus from memory they have fast refi available.

    • Oneiricer on 15/04/2018 - 11:40

      Got a link to the offer? Includes offset?

  • Brianqpr on 15/04/2018 - 11:00
    +2

    Reduce home loans has a 3.39% variable loan.

    • steve08 on 15/04/2018 - 11:08

      the cheapest in Australia.

    • WreckTangle on 15/04/2018 - 12:19

      Link?

        • SuperSonic on 15/04/2018 - 15:22

          Does it have an offset and how is the overall experience with them ?

        • stebie on 15/04/2018 - 16:25

          @SuperSonic: I don't believe the one I linked has an offset, but they do have another loan with offset at a higher rate, 3.49%, and has a debit card linked to the offset account for $10/mo (not sure if this is optional or mandatory).

          http://www.reduceloans.com.au/rate-buster-high-lend-variable…

          I don't have a loan with them so can't comment on experiences.

        • SlickMick on 15/04/2018 - 23:32

          @stebie:
          when you talk to them and see the conditions they quickly get dropped off your shopping list.
          I think that rate was for a $700,000 loan, lesser amounts have additional fees. Or I might be confusing them with another, but they got dropped from my list due to the conditions on loan.

    • yanivsr on 15/04/2018 - 15:00

      Do you know if this includes offset account? I also read that they are changing the rate after 1 year to a noncompetitive one,from your experience, is that true?
      Cheers!

    • ely on 15/04/2018 - 17:10

      Sadly their fixed rates are crazy high :-/

  • Wally Simmonds on 15/04/2018 - 11:22

    So, anyone have any recommendations for brokers?

    • Hoju on 15/04/2018 - 11:46

      So far my experience with Ethan from Lendi has been pretty exceptional

    • steve08 on 15/04/2018 - 14:31

      Also have had good experience with lendi Via micheal in the past American guy. They usually go to click loans being fast any easy, amp as well.

    • fozzie on 16/04/2018 - 09:36

      Phil Wheatley at mortgage choice

  • SaberX on 15/04/2018 - 12:59

    Im with bankwest atm. At time of the loan i went to about 88% lvr and over time im now up to 4.11% on interest only. Its a 5 yr term before p & i switches. Ive been considering refinancing but was abit lost as to what fees you pay your bank and the process. Is it just discharge fees per your schedule?

    And how do they determine in many of these deals where you need 80% lvr what value to tf your loan at. I borrowed at 88% lvr at the time based off my land and adding in my building contract to build. So figures are known. Now that i have an established house how do i self assess how much i need to bring the loan down to or save to ensure ive got 80% lvr? Do i need to pay for a valuation to be done?? And hope the banks is similar?

    Also how do many of you approach the fact that the rates are low for a few different competitors but whats stopping them running a much higher rate 1 yr in while your sucked in?? Are there any banks known for doing this and others which are known for being more fair??

    And many good suggestions above but are these interest only rates?? And any other fees in the refinancing process to note? In assessing if worth it?

  • sauce2k on 15/04/2018 - 13:58

    Hmm nice one!

    If you are an investor might worthwhile look into cba. They had a special rate 3.88% fixed for 2 years for investor loans comes with offset

    • Slo20 on 16/04/2018 - 07:16

      Usually offsets only offset variable loans. You saying the cba deal offsets the fixed loan?

      • sauce2k on 16/04/2018 - 09:16

        i wish haha!

  • Ss-ss on 15/04/2018 - 14:22
    +2

    I moved to UBank few years ago. No issues at all, so I would recommend

  • Snatcher on 15/04/2018 - 14:26

    Any tips on lenders if one wants to do 90% LVR? Thx!

  • jsheroes on 15/04/2018 - 14:46
    -1

    There are several deals better than this in the market, regardless of what your priority mortgage features are.

  • pixxelpusher on 15/04/2018 - 15:01

    I'm very new to the world of loans, mortgages and home buying but I've just read through this and was hoping someone could check my math. Purely hypothetically say I've saved $150k over the years and want to buy a house (as a first home buyer) that's $400k. If I put 15% towards a deposit ($60k) then I'd be looking at a home loan amount of say $340k. If I put the remainder of the savings ($90k) into an offset account does that bring the amount on the loan that interest is paid on to $250k? So then if the interest rate is say 3.6% am I having mortgage repayments of $9000 a year?

    Also, is it better to make a larger or smaller deposit at the start (20%, 30%?). And is it better to have a longer repayment period or shorter, i.e 30 years vs 20 years? Are there any other incentives / discounts I should be aware of as a first home buyer? (looking to live in, not investment).

    • ely on 15/04/2018 - 17:16
      +2

      Generally you'd want to put in at least 20% otherwise you'll pay extra for Lenders Mortgage Insurance, the exact amount of which varies depending on the lender, amount under 20% you are, etc. Also in some markets (mainly high density areas of Melbourne, Sydney, Brisbane) some lenders will flat out require at least 20%.

      Otherwise the maths looks about right (haven't checked figures, but yes, the amount in your offset counts as if it was in your mortgage already and so reduces the interest paid).

      • pixxelpusher on 15/04/2018 - 21:12

        Ok thanks for confirming that's how it all works. I'm in Tasmania so I'll have to research more, there's still a lot I need to know before jumping in. But I never realised the repayments would be so low, I'm currently paying almost double that in rent per year. Really should have looked into this years ago.

        • ely on 15/04/2018 - 22:44
          +1

          It's not the only difference, you'll pick up home and contents insurance, rates, water bills (additional to the consumption costs you pay as a tenant, may depend on state), possibly strata fees, and maintenance costs. It all adds up, so it's not quite as good as you're probably thinking, but yeah, surprisingly cheap at today's interest rates - may not be that way forever though.

        • pixxelpusher on 16/04/2018 - 20:23

          @ely: Right, yeah these are all the things I don't really know much about and I'm sure they all add up. Still it seems like it may still be less than spending (wasting) $350-$450 a week in rent. A lot I still need to know before getting in. Building was another option I was thinking of, but that seems even more risky for a first timer.

  • fozzie on 15/04/2018 - 16:58

    The mortgage I switched to is https://www.cua.com.au/loans/home-loans/advance-variable

    You can offset up to $50.000 and the rest goes in a redraw facility. Very happy so far as saving over $300 a month compared to my previous loan. Mortgage choice’s broker found it for me

  • ely on 15/04/2018 - 17:48

    Currently on 3.86% (variable) and 3.74% (fixed), about 50/50 split. This is a little better, but not a lot (17 basis points on the variable, same on their three year fixed) and it's hard to know what it actually costs to break a fixed mortgage. Unfortunately the places that I see with very good variable rates (e.g. loans.com.au, reduce, etc) have terrible fixed rates, which is why I ended up where I am - at the time they were the best combo of fixed and variable that I could find. Any better offers out there that have good variable and fixed rates?

    • naritas on 15/04/2018 - 18:16
      +2

      In our experience (as finance brokers), Newcastle Permanent has been quite popular for combination loans.

      Check out their Premium Plus products. In particular, their 100% offset Premium Plus variable (3.64%p.a.) which can be combined with their 2 year (3.69%p.a.) and 3 year (3.74%p.a.) fixed rate products under a single package fee ($395 p.a.).

      Hope this helps.

      • ely on 16/04/2018 - 07:49
        +1

        Thanks, I'll have a look. Shot off a message to my current providers to see what the break costs would be so that I can figure out whether it's worth the hassle.

        • ely on 20/04/2018 - 19:15

          Break costs are surprisingly low - low enough to make this UBank deal a marginally better deal, as the $1k bonus would cover break costs, the annual fees are a little less, the three year fixed is the same and the floating is lower. Newcastle Permanent's $395 annual fee is a bit steep though, I'll have to run the numbers but UBank's is probably a better deal.

  • [Deactivated] on 15/04/2018 - 18:29

    The best thing to do would be to contact your current home loan provider threaten to leave and squeeze them for a better rate.

  • Thaal Sinestro on 16/04/2018 - 06:25

    I saw recently that 30% of owner/occupiers are on interest only home loan, which is distrurbing. I guess it is too hard to pay off the principle on a 1 millon dollar "mansion", so they just wait until they retire and have a fortune in superannuation to burn through.

    • ely on 16/04/2018 - 07:52
      +1

      Probably the case for many, but not for all. Interest only is what your minimum repayments are, you can generally pay extra. I know of some that have interest only on their primary residence because they plan to later turn it in to an investment property; at that point in time they'll pull all of their extra repayments out to put towards their new home, leaving the minimum balance behind, so as to minimise the interest that they pay on their non tax deductible home mortgage and maximise the tax deductible interest paid on their investment.

      • fredblogs on 16/04/2018 - 11:21
        +1

        Exactly - the 30% figure is pretty meaningless without knowing what's in their offset accounts.

    • fozzie on 16/04/2018 - 09:37

      Why is it disturbing? Their choice after all….

  • mobius on 16/04/2018 - 11:14
    +1

    Is this available to existing ubank customers.

  • Ughhh on 28/04/2018 - 14:27

    Is 5 months into a owners occupied home loan (first home loan) too early to refinance?

  • OldBugger on 06/05/2018 - 11:42
    +1

    Just a heads up that the $1000 offer has been extended to 6 June

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