Hi All,
Im hoping a broker here can help me understand this.
Im under the ANZ breakfree pro package and am looking at taking out a LOC shortly.
I was all set to apply for the Equity Manager Loan as is seems to fit my requirements perfectly. No minimum payment and reasonable interest rate. My bank manager has recommended the Home Equity Loan instead saying that the Equity Manager Loan requires my salary directly dumped in it. Im not sure this is correct.
The link below does discuss some differences.
http://www.anz.com.au/aus/homeloans/…ty/default.aspMy banker sent me two pdf’s which my banker sent me to explain it further however I still dont see the point in my going with the Home Equity Loan. Its more expensive interest rate and it requires a minimum repayment.
Can someone explain why I cant use the Equity Manager Loan and why my branch manager thinks the Home Equity loan is better for my requirements?
If you need further info, please let me know.
All comments most welcome.
Cheers,
Damon
PDF’s sent me:
http://www.somersoft.com/forums/attachment.php?attachmentid=1558&d=1154920712
http://www.somersoft.com/forums/attachment.php?attachmentid=1559&d=1154920718In theory, there is no difference between practice and theory, in practice, there is….
Hi Damon. My understanding with the breakfree package is that you have direct access to your ‘personal manager’ via the phone , for the running /details/questions etc on your account. You will find the ‘head office’ may be more knowledgable on this than your local branch manager. I have the info on both accounts, and under the breakfree package the Equity Manager annual fee is waived, is basically, other than the interest rate of course, your main difference is that the equity manager is a full transaction account, so your income etc does go straight in, and your credit facility/credit cards etc are also all linked in. The Home equity loan is basically just that, LOC on the property, with no other ‘tie in’s . You may like to double check, but according t o the ANZ website, it looks like your accessing Equity manager funds via ATM it has to be an ANZ? Have a look here if want to see them side by side. http://www.anz.com.au/aus/homeloans/productinfoequity/equityManager.asp
I guess with the interest rate lower, you would have to not want an ‘all in one’ transaction account to not go the one you chose in the first place….equity manager. All the best.I am on the ANZ breakfree package and I have a equity manager LOC set up (to access equity), plus other IO loans with the 100% offset account set against one. Salary does not have to go into this account (mine doesn’t). I cannot see any point in opening the more expensive Home Equity Loan.
If you look at the comparison here:
http://www.anz.com/aus/homeloans/productinfoequity/default.aspyou will see there are more restrictions on the expensive one, eg less free withdrawals.
Terryw
Discover Home Loans
Parramatta
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Hi Terry,
Yes, this is what I thought, however am being told different by ANZ.
Do you have a PPOR loan in your structure as well? I do, maybe that matters? As the AnZ said the Home Equity Loan would be better at keeping personal loans seperate from Investment loans. Unfortunetly i dont know cos ive never seen the product and tbh, i havent had much confidence in the ANZ explaining it.
Im glad you have the structure im after as it does give me some hop i can do it. (I dont want to pay the higher interest rate for the same functionaility.)
In a nutshell:
My current structure is 1 PPOR Loan with offset account attached. 1 IP loan Interest only. These loans are obviously seperate accounts.I want to access the equity built up in the portfolio using the equity manager loan as said before (i have about 55K icould take out keeping me below 80% LVR across the portfolio). I would take out the LOC and let it sit there until I require the funds, then I will drawdown as needed.
Is this the same setup you have Terry? If not, can you explain the difference between yours and mine?
Cheers,
Damon
In theory, there is no difference between practice and theory, in practice, there is….
Forgot to mention, the LOC will be used 100% for investment purposes.
Cheers,
Damon
In theory, there is no difference between practice and theory, in practice, there is….
quick update:
I just got off the phone to one of the breakfree guys who was very helpful to my situation.
He set it straight and said there was no reason I couldnt go the Equity Manager loan and that there was no requirement for my salary to be deposited into the LOC.
So, serveral ANZ conversations later I have the required result. I just need to convince my branch manager now. I think I’ll just pass the breakfree guys name onto her and hopefully all will be sorted. [rolleyes]
Cheers guys and gals,
Damon
In theory, there is no difference between practice and theory, in practice, there is….
Hi Damon et al,
The home equity loan is more an offset account, whereas the Equity manager is a LOC.
Keep a close eye on which one you really need. An offset account is great if you dont plan to redraw too often and just simply want to have the loan paid off. Also you need a minimum of $5000 in the offset account at all times to have this account set-up work.
Because you are looking at investing, redrawing and re-investing, i would recommend the LOC (stay with ANZ if you want, but i prefer other banks for their LOC’s). Keep the two accounts for personal and business seperate always (for tax of course).
Depending on what size loan you are taking out (im going to assume that it is >$250,000 due to their being two properties) you should be able to look towards under 7% or no more than 7.11% (including the latest rise).
If you’ve got any questions, feel free to drop me an email or a line. I’m an experienced broker working out of Bris, Perth, Syd, Melb, Ballarat, Hervey Bay, and Cairns.
Cheers
NikAlliance Finance and Property
0405151645
[email protected]Originally posted by kinkso0o0o:Hi Terry,
Yes, this is what I thought, however am being told different by ANZ.
Do you have a PPOR loan in your structure as well? I do, maybe that matters? As the AnZ said the Home Equity Loan would be better at keeping personal loans seperate from Investment loans. Unfortunetly i dont know cos ive never seen the product and tbh, i havent had much confidence in the ANZ explaining it.
Im glad you have the structure im after as it does give me some hop i can do it. (I dont want to pay the higher interest rate for the same functionaility.)
In a nutshell:
My current structure is 1 PPOR Loan with offset account attached. 1 IP loan Interest only. These loans are obviously seperate accounts.I want to access the equity built up in the portfolio using the equity manager loan as said before (i have about 55K icould take out keeping me below 80% LVR across the portfolio). I would take out the LOC and let it sit there until I require the funds, then I will drawdown as needed.
Is this the same setup you have Terry? If not, can you explain the difference between yours and mine?
Cheers,
Damon
In theory, there is no difference between practice and theory, in practice, there is….
Sounds almost exactly the same as my set up. Glad you worked it out.
Terryw
Discover Home Loans
Parramatta
[email protected]
Sign up to my mailing list.
Just send me a blank email, with “subscribe†in subject line.Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Yes finally!
You wouldnt believe it either, after all that.
I emailed the branch manager today and told her what i had discovered and she replied saying casually “No worries, so shall we setup the Equity Manager then?”
*sigh*
As nice as pie as she is, I could have throttled her….[evil4]
Cheers guys thanks for the hand.
Damon
In theory, there is no difference between practice and theory, in practice, there is….
Its funny how some bank staff do not know their onw bank’s policies.
Today I had a client who went to their Bank St George, and ws told they didn’t qualify. I did some checks and they qualified easily. strange.
Terryw
Discover Home Loans
Parramatta
[email protected]
Sign up to my mailing list.
Just send me a blank email, with “subscribe†in subject line.Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
yea, tis crazeh!
but i guess they’re just like any other people running a business. You have your dopes and you have your knowledgable ones. It all depends who you speak to in end it seems.
Its funny, I guess i thought banks would be different, but i guess thats just a stigma.
Cheers,
Damon
In theory, there is no difference between practice and theory, in practice, there is….
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