A lot of changes this past 6 weeks:
Lenders putting assessment rates up from 2.50% to 3.00% on top of the interest rate that you get. On 1 mill loan size this could affect your borrowing power by 50-70k
Some lenders are putting Debt to income ratio caps in place ie you cant borrow over 6 DTI at ING on investment > Citibank > AMP 6+ DTI limits the lvr to 75%. Myriad of others new rules at other lenders as well.
Fixed rates have gone through the roof mainly on owner occupied on 2 and 3 year fixes. 1.89% has now turned into 2.19-2.39% range on 2 year fixes on average and 3 year fixes have gone as high as 2.60-2.70% range on 3 year fixes. So people are flowing through from the big 6 lenders to a few mid tier lenders that have left their fixed rate low.
Variable rates have dropped. IE ING is an amazing deal on P&I on both owner occ and investment right now coming close to where the 2 year fixed rates used to be
8+ banks are quoting 8+ day sla's ie service levels to get to assessors right now due to the last minute 5-6 week volume before Christmas
Where are a lot of the deals going at the moment and why?
AMP 3k rebate over 500k loan size. A lot of INTEREST ONLY going here on INVESTMENT 2 year fix 2.44% 2 year fix io comp rate 2.56% and variable 2.59% variable io + offset comp rate 2.34%. Also good for large 100+ k cash outs. 6-7 day sla.
ING 3k rebate for over 500k loan size. Variable p&I on both OWNER OCC 1.99% variable + access to redraw comp rate 1.99% & INVESTMENT 2.29% variable P&I with access to redraw comp rate 2.29%. 3 day sla.
Suncorp 3k rebate for over 750k loan size and solar rebate $500 - mainly sending 1.99% 2 year fix + no annual fee for life saving 375 annually comp rate 2.46%. Doing good pricing on variable at the moment as well through the bank bdm. Also sending a bit of 2 year fix investment p&I 2.28% here comp rate 2.89%. Just brought in a new 100+k large cash out policy. Im a gold status broker here. 10 day sla.
Me bank Havent put up rates but i hear its happening this week. Mainly getting large cash out done here. Large loan size super good on pricing requests with me bank bdm and 3k rebate per application so sending large portfolio multi property refinances here. 3k per 250+k loan. 6-8 day sla
Citibank Overloaded 10-15 days sla coming up to Christmas and just put rates up. getting deals done but its slow. Im citi select premium broker. 10-15 day sla.
CBA / Westpac / St George / NAB / ANZ - Largely un-competitive on fixed rates now compared to mid tiers. Only ones going here are professional 90% no lmi for lawyers doctors accountants. Ok on a few of the variable rates since they dropped those recently. CBA and NAB 2-4 day sla are the quickest here. ANZ 10-15 days sla Westpac and St George 6-9 days sla the slowest.
Large borrowing power is going to firstmac in the mid tiers due to no max debt to income ratio limits and much higher borrowing power and lower rates then the major 6 banks. Reason is they are not a ADI ie they dont take deposits so apra and asic new rules dont apply to them. Anything over a 7 debt to income ratio is becoming tougher in the current climate with asic and apra changes but still achievable.
SMSF Is going to first mac 3.99% comp rate 4.00% a lot of outdated cba /westpac/stgeorge loans that couldnt refinance on 5-6% rates are going here now.
Refinance rebates min loan size for most of the offers is 250k
ING 3k rebate - loan size over 500k per app
AMP 3k over 500k loan size
Me bank 3k per app
St George 3k
Citibank 3k 350k loan size to 750k and 4k for balances over 750k under 80% lvr purchases and refinance + 6k for over 1 mill
Suncorp 3k over 750k loan size + no annual fee for life saving 375 annually + 500 solar rebate
Other rebates for buyers
Citibank - 3-4k purchase rebate
BOQ - 2k investment purchase rebate
Suncorp - Lifetime annual fee waiver for buying
Broker Cashback $500 for balances between 300k and 700k net of offset & $1000 cashback for balance over 700k net of offset. Broker rebate paid post settlement normally 2 months post settlement and on complete variable into 2 payments on 2 and 24 months.
Types of clients suitable on a plus 3.00% rate? or havent reviewed your mortgage in 18-24 months?
We are looking for clients that are seeking a broker relationship that will be reviewing their position every 2 years to make sure its competitive to the market.
Not suitable for fully offset clients.
We are also looking for long term relationships with clients, if you intend to refinance again or sell within 12 months, the banks actually claw us back on our upfront commission completely so we would be unable to help in these circumstances. I will do my best to reply to all comments.
My experience 7 years in commsec and cba on a margin lending desk and as in in house cba branch home lender. 4 years as a mortgage broker running my own company.
You can book an appointment straight into my calendar - https://calendly.com/adrianplayermortgagebroker/15min
or send me a sms
Or email - [email protected]
Adrian Player is a credit representative (498364) of BLSSA Pty Ltd ACN 117 651 760 (Australian Credit Licence 391237).