Hi all,
I’m trying to sort out my first home loan, for an investment property. I’m looking for an IO loan, for about $240k, with about 85.5% LVR and a 100% offset account.So far, I’ve found the following:
– ING Direct Orange Advantage (currently 6.96%, $0 application fee, $16.60 p/m for offset account)
– Bankwest Premium (currently 6.7%, $700 application fee, $3.99 p/m for offset account)
– Bankwest Rate Cutter (currently 6.9%, $0 application fee, $15 p/m for offset account)I hadn’t considered the Bankwest loans until yesterday – a broker recommended them to me. The Rate Cutter’s interest rate drops by 0.1% every year you have the loan, to a maximum of 0.8% below their standard rate (starts at 0.4% below their standard rate). Ie, currently, the Rate Cutter would drop to 6.5%, once it gets to it’s maximum discount, it’s for the life of the loan.
I keep finding posts mentioning that the big banks have similar rates, with discounts of up to 0.7%, with comments such as “why bother with these banks when the big banks have just as good or better rates”. But I can’t find them! Everything that I’m finding is more in the 7.2-7.4% range. Are there any with a lower rate, with a 100% offset account? Are there any for a < $300k loan?
If you push the loan to 250k (or take a credit card to get total limits over 250k) most the banks will give you 0.7% off. You need to cross 500k to get this at CBA. This will get you under the rates you are quoting.
There's better deals out there. As Banker said, if you go to $250k you'll be elligible for discounted rates with some lenders.
Homeside will be cheaper than those mentioned – 6.57%, $763 establishment fees, $10 p.m ongoing. It's about $20 cheaper per month than the Bwest Premium.
Jamie
Jamie Moore | Pass Go Home Loans Pty Ltd
http://www.passgo.com.au
Email Me | Phone MeMortgage Broker assisting clients Australia wide Email: [email protected]
Thanks for the replies, I’ve started looking at the other major lenders (presuming ANZ, Westpac etc?). I have found that Westpac has a “Rocket Investment Loan” that has an offset account and a 0.7% discount when you get their package, which works out to be $0 application fee, $33 per month, rate of 7.51-0.7=6.81% (making BW or Homeside a better deal). I can’t find the applicable ANZ discounted rate loan.
With regards to homeside, I think what threw me was that they refer to the lower rates as a “Promotional Interest Rate” – is this something that is likely to be withdrawn at any time, or is this the standard rate for all of their loans (disregarding official rate rises)?
The discount should be for the life of the loan.
ANZ's Breakfree rate is 6.71% (0.7% disc) with no app fee and $375 annual fee.Remember that Homeside is only the cheapest right now because they didn't go above the 0.25% RBA rise that the other majors did in December 2009, and we'd expect them to come back to rate parity eventually…
Glad to hear Homeside is the cheapest one! I am having a loan from Homeside!
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