Forum Replies Created
- Originally posted by real:
Hi all,
I beleive it is not about Bank VS Non Bank, it is about Product VS Product!I am an ex-Power Loan Branch Manager and Senior Service Manager that created a good client base and went on confreneces , etc. over 2 years, so I am very qualified to know what really is behind Power Loan.
The real deal is this: The Power Loan product is no better than any other on the market (There are many at better rate and same flexibility) . They cannot compete on interest rate, that is why they don’t focus on it. The main product is Interstar, which many brokers also use (at lower rate mind you) yet Power Loan consultants are “conditioned” to saying Brokers are crooks! Is that ETHICAL?
It is service that they push, but that really depends on individual franchisees. I can tell you some are good and some are not! Most have had no previous experience in finance and are conditioned to beleive Power Loan is the best thing since sliced bread and if anyone says otherwise, to squash them straight away!
(You watch all the new Power Loan consultants try quash this posting) – see if they are still there in 12 months though and talk to them then.
Not picking on Jace, he is probably a nice guy and told it as he saw it and good on you mate, but Steve from MM Market pointed out some real ALARM bells. This is typical of the inexperienced consultanat they target to sales training!
Power Loan portray an ethical environment but if you ask questions or think for yourself you are quickly told to tow the line and have blind faith.
Don’t get me wrong, at the end of the day I learned something of finance sales ( not much about finance, that I now know ). It is a good business and the loan is fine, but the point is, it is definately not always best for the client!
Only an independant broker can find a better product for a client. Power loan only have one product, because they have to appease the “Packer” (Challenger) group of companies, therfore cannot use other non-bank lenders or banks.
Power Loan consultants are taught to say that ” Interest rate is not the major cost of the loan and that banks fees and charges account for almost half the true cost of the loan” 50%? ? NOT FACTUAL!
I bet not one of the consultants put this into a spreadsheet to find out how wrong this statement is. Try using facts: put $10 p/m fee and add in a transaction fee or two and even a redraw fee here and there see if .5 % interest rate discount would well outstrip the negatives of the fees over the term of the loan.
I don’t like fees either though. Check out the loan products below that don’t have any fees or charges ongoing and are more flexible (some no app fees or val fees either).
Power Loan charges $660 app fee half goes to account manager and half to consultant – fair enough! But $275 Valuation Fee? (of which $55 goes to consultant) therfore their valuation fee should really read $220 – (Missleading! ) which is still quite high!
I’m not sure what other deal they have with valuers, but I know the valuer only gets about $60 -$100 dollars of that.) ETHICAL?I beleive most of the franchisees and consultants are ethical and good people, but the the company itself you eventually find out is less than ethical. I could tell you much more bit I won’t……. Let’s move on:
Every client has different circumtances, so how can one loan be good for all? Power Loan best rate: 7.45% Interstar
Broker xyz 6.95 % Interstar, Broker abc 7.2 % (SAME LOAN) – but there are better loans out there too!…And debt reduction is not rocket science:
Have your Pay go diredctly into your loan including additional funds, GST funds, etc, or have a true 100% offsett account and try and keep it there as long as you can. Don’t redraw and spend it!…That’s it, end of lesson! No need for 12 week sales brain washing sessions!
Here is only a short list products that are currently hard to beat ( remember every client should have a fact finder done before offering any product options)
ING Mortgage Simplifier 6.90% No fees or charges, no redraw fees.
Homeloans Ltd 1-5 yr fixed (7.2% to 7.45%) with 100% offset Account! – no fees, no charges no redraw fees
Macquarie 7.23% no fees, charges or redraw fees – with atm card -NO FEES at any ATM in Austarlia!, no min redraw.
HSBC – have products in this category too! with high LVR’s
Members Equity – even better rates
HomeSide Lending
AC Credit Union – good for families where servicabilty is tight.The list can go on.
Remember go with a Broker you like and compare products to your circumstances now and in the future. Ask questions!
Cheers,
John 4 Real
Hey again,
Guess im dragging this on but oh well
You really do hit the nail on the head, i agree with pretty much everything you have said, i still feel the strategies are important and what powerloan promotes is offered by most financial institutions, but the awareness isnt there unfortunetely, the client has to seek out these options.
the books powerloan turned me onto are great and i continue the read them, i always felt uneasy with in the company and count my experience there as a point of finding a great direction in my life.
As an end to this topic, good luck to all you property hunters, hope those interest rates dont hurt you all to much. [thumbsupanim]
Best wishes
Jace
ok, i worked for powerloan for about 6 months, and most of the time (up until the westpoint crash) was enjoyable…The workshops are not much more than a sales pitch, so that part of the added value service from the company is a bit dodgy. and i dont know why you said you can only go 12 times?, they were allways free to the public. I believe firstmac is one of Powerloans lenders, but the “premium” facility is challenger or interstar. The way it works is you will be a client on someones franchise, and the franchisee is your service manager, they do have good strategies, but if you look for a good book and have a bit of common sense, its not hard to half the term of a loan once you have the knowledge. Powerloan also push for you to invest equity, which obviously increases the loan size and the commission of the consultant. so as you should know every investment has some risk, no matter how well its “SOLD”
…just remember your the customer and the customer is allways right, A bank generally will put fee’s on your loan account and try and “SELL” you more accounts incurring more fees, so if youre lazy and dont bother checking these things you will get stung in the pocket, but if you tell the bank you have been offered a loan with no fees at whatever percent or simply say you wont pay fees on your account, im sure they will do their best to beat whatever you have been offered, if you ofcourse have a deposit and income. powerloan generally wont be able to beat banks on the interest rate, of the time i was there i saw the interest rate drop for a client once, and it was one of my friends who thankfully found finance elsewhere, and i doubt firstmac has much if any service at all, im not sure if they are wholesale or not…., i learnt alot about SALES from powerloan, and not very much about finance, i had to ask alot of questions…just remember they are selling you a product, and finance organisations have to be competitive, they wont give you the money for nothing, but ya dont want to pay 3 times what you borrow..i dont know if i can advertise or anything, but one of the best faciilities i ever saw was of a client who ended up refinancing to powerloan, he was with Members equity, very low cost standard variable loan, and dont charge you annual or redraw fees, so you can run all your income through the loan reducing your interest cost, so you get all the flexibility powerloan offer, but unfortunetely without the payment timing strategies, take a look at their website…good luck man, dont let them tell you what you need, do alot of research, and read books, you gotta educate yourself about negative compounding interest and how it works, so you can reduce the over all cost of your loan, remember you wouldnt pay a credit card off, by paying the annual fee, would you? yea, im not sure how much advice i can give on here, dont wanna get in trouble as im not qulified in finance at any level but yea, i doubt most brokers know themselves how simple it is to reduce the term of your loan, and they most likely wont help you until you want to refinance, goodluck hope it works out for you ….JACE
…just remember your the customer and the customer is allways right, A bank generally will put fee’s on your loan account and try and “SELL” you more accounts incurring more fees, so if youre lazy and dont bother checking these things you will get stung in the pocket, but if you tell the bank you have been offered a loan with no fees at whatever percent or simply say you wont pay fees on your account, im sure they will do their best to beat whatever you have been offered, if you ofcourse have a deposit and income. powerloan generally wont be able to beat banks on the interest rate, of the time i was there i saw the interest rate drop for a client once, and it was one of my friends who thankfully found finance elsewhere, and i doubt firstmac has much if any service at all, im not sure if they are wholesale or not…., i learnt alot about SALES from powerloan, and not very much about finance, i had to ask alot of questions…just remember they are selling you a product, and finance organisations have to be competitive, they wont give you the money for nothing, but ya dont want to pay 3 times what you borrow..i dont know if i can advertise or anything, but one of the best faciilities i ever saw was of a client who ended up refinancing to powerloan, he was with Members equity, very low cost standard variable loan, and dont charge you annual or redraw fees, so you can run all your income through the loan reducing your interest cost, so you get all the flexibility powerloan offer, but unfortunetely without the payment timing strategies, take a look at their website…good luck man, dont let them tell you what you need, do alot of research, and read books, you gotta educate yourself about negative compounding interest and how it works, so you can reduce the over all cost of your loan, remember you wouldnt pay a credit card off, by paying the annual fee, would you? yea, im not sure how much advice i can give on here, dont wanna get in trouble as im not qulified in finance at any level but yea, i doubt most brokers know themselves how simple it is to reduce the term of your loan, and they most likely wont help you until you want to refinance, goodluck hope it works out for you ….JACE
