Athena Keeps Home Loan Rates Unchanged after four consecutive drops.
Athena Keeps Home Loan Rates Unchanged
dust on 20/03/2020 - 16:46
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exactly. they fund themselves from wholesale markets. margins in wholesale markets have shot up massively even for the majors. not sure how low quality issuers like Athena are surviving at the moment, they probably have a similar model to RAMS?
exactly. they fund themselves from wholesale markets.
Doesn't look like it.
https://www.afr.com/companies/financial-services/home-loan-d…
https://www.afr.com/technology/exnab-home-loan-disruptors-sc…
Plus this from their faq page:
Our strategic funding partner RESIMAC is underpinning our public launch.
So they access funds from RESIMAC who go to the wholesale market themselves.
Those links refer to their shareholders.
If they are relying on resimac for their funds then their shareholders will be suffering a lot of pain.
Interested to see if any of the other cheap home loans pass it on or not (loans.com.au, Reduce, etc).
Full statement I just got emailed:
Yesterday the RBA announced a drop in Australia’s cash rate. For the last 4 RBA rate changes, Athena has proudly dropped our rates in full and instantly to all customers. This time, we are leaving our interest rates unchanged. We might cop a bit of flack for it, considering we have been vocal when others haven’t dropped theirs. But a lot has changed in the past few weeks. We wanted to share with you why we took this decision. Why this time it’s different.
The RBA has dropped rates because of the global economic disruption from the Coronavirus crisis. That same disruption has caused the cost of funds for mortgage lenders across the industry to rise significantly. So while the RBA has cut rates, sadly the cost of money has risen. We already have incredibly sharp pricing, to give you the best deal. In that context we are keeping our current low rates steady, from just 2.59%1.These are great rates, without all the fees, to enable longer-term savings for our customers and give us both a little more certainty.
Great rates that stay great
This is what’s most important to us. We’re not that lender that gets you in on a low rate, only to sneakily hike it up over time. We are the only Aussie lender with the automatic rate match, where we guarantee we will never charge our loyal customers, more than new customers on a like-for-like loan. And so far we’ve saved customers over $187 million2. We will continue to do everything we can to help customers save money in the short, and long-term.
Saving money shouldn’t just be reliant on RBA cuts. We want to put that in your hands. That’s why we give you Home Loan Hacks to help you save money in all kinds of ways and pay off your home loan faster.
This isn’t about being greedy. That’s not who we are. This is about remaining steady in volatile times and doing what’s best for everyone in the longer term. We’re in this together.
As always, if you’d like discuss this with us, we are more than happy to. Please feel free to reply to this message.
Nathan Walsh & Michael Starkey
(Athena Co-Founders)cool story bro
At times like these we need a lender of last resort.
One moment while I put on my tin-foil hat…
There was a lot of talk when Athena last passed on the rate about the difference between offset/redraw accounts, particularly that if the lender runs into financial trouble they can "claim" the money in redraw to pay off the home loan at any time, and thus the borrower loses all that liquidity. Most dismissed the possibility of that happening however as extremely unlikely.
https://www.ozbargain.com.au/node/522158
A lot has changed between now and then, anyone have any further thoughts on this?
Regards,
Someone with a lot of dolleridoos sitting in a redraw account.I was thinking the same thing last night and nearly pulled out all the redraw I have available..
I don't understand the financial market well enough to make an informed decision..
I don't understand the financial market well enough to make an informed decision..
Perhaps just start with reading your home loan documentation from cover to cover. It was the document that you signed 25 to 30 years of your life away on afterall.
Is it going to tell me what Athena are going to do next? I never noticed that when I was reading it…
Is it going to tell me what Athena are going to do next? I never noticed that when I was reading it…
Should help you understand if you need to do a massive redraw.
Since you are very up to date with your contract now, you should understand what happens in an event of default by your lender and what rights to set-off they have.
Funding costs is absolutely BS.
Another landmark initiative is the RBA offering all Australian banks at least $90 billion of three-year funding at an ultra-cheap cost of just 0.25 per cent.
They can't afford to pass it on. They are most likely struggling with credit markets