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Can you beat this variable home loan rate


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#1 coffy11

Posted 29 July 2019 - 11:48 AM

Hi

Currently looking at variable rate home loans and have found one with Loans.com.au for 3.05%.  Does anyone know of a lower rate home loan?

The features need to be redraw facility and can make extra repayments.  Don't necessarily need the offset.

Thanks!

#2 chillipeppers

Posted 29 July 2019 - 12:58 PM

That’s pretty low. We are currently on 3.4 and can’t get them to drop any lower

Edited by chillipeppers, 29 July 2019 - 12:58 PM.


#3 IamOzgirl

Posted 29 July 2019 - 05:40 PM

Is that fixed or variable?

#4 Hands Up

Posted 29 July 2019 - 05:41 PM

That sounds pretty good to me. We are currently on 3.38.

#5 Sed

Posted 29 July 2019 - 06:10 PM

That sounds good. We are 3.34 variable rate with UBank.

#6 c4a79

Posted 29 July 2019 - 08:38 PM

I think Virgin Money is around that rate.  No offset but ability to redraw.

#7 WaitForMe

Posted 29 July 2019 - 09:42 PM

Sounds pretty amazing, is there a catch?

I see its a 'Discount Offer' what does that mean? Will it only be temporary?

#8 coffy11

Posted 30 July 2019 - 03:49 PM

View PostWaitForMe, on 29 July 2019 - 09:42 PM, said:

Sounds pretty amazing, is there a catch?

I see its a 'Discount Offer' what does that mean? Will it only be temporary?

The discount offer means that it's discounted based on the reference rate.  So it's really just a discount like when you buy something?

It does seem really low but all looks legit.  It's just a no frills online loan.

#9 spartan_mum

Posted 30 July 2019 - 08:36 PM

I’m currently in the process of refinancing with the same company. I couldn’t find another rate lower.

Process has been slooooow but I guess it always is with these things.

#10 WaitForMe

Posted 30 July 2019 - 08:43 PM

View Postcoffy11, on 30 July 2019 - 03:49 PM, said:

The discount offer means that it's discounted based on the reference rate.  So it's really just a discount like when you buy something?

It does seem really low but all looks legit.  It's just a no frills online loan.

How long do you get the discounted rate for though? Will it be a reduction off their variable rate for the lifetime of the loan?

#11 ckmelb

Posted 30 July 2019 - 08:48 PM

Do they have an offset facility? I sometimes see very low rates that don't have access to an offset account which is a deal breaker for my circumstance

#12 WaitForMe

Posted 30 July 2019 - 10:22 PM

View Postckmelb, on 30 July 2019 - 08:48 PM, said:

Do they have an offset facility? I sometimes see very low rates that don't have access to an offset account which is a deal breaker for my circumstance

The offset has a higher rate.

We have an offset atm but the rate they have on the non-offset gives us a yearly saving thats greater than we get from our offset, and I don't see our offset growing by much over the next couple years, if at all given the base account has a redraw.

#13 ~THE~MAGICIAN~

Posted 30 July 2019 - 11:22 PM

I negotiated this week actually, got them to drop to 3.21 (ANZ)

#14 coffy11

Posted 31 July 2019 - 11:29 AM

View PostWaitForMe, on 30 July 2019 - 08:43 PM, said:

How long do you get the discounted rate for though? Will it be a reduction off their variable rate for the lifetime of the loan?

yeah that's the way I understand it

#15 coffy11

Posted 31 July 2019 - 11:30 AM

View Postckmelb, on 30 July 2019 - 08:48 PM, said:

Do they have an offset facility? I sometimes see very low rates that don't have access to an offset account which is a deal breaker for my circumstance

We don't need an offset account as I keep pretty much all of our money in the home loan and then transfer out as needed

#16 doubledelight

Posted 31 July 2019 - 11:37 AM

What about additional charges for extra repayments or early discharge of mortgage?  Are there any other ongoing fees associated with the servicing of the loan.

#17 coffy11

Posted 31 July 2019 - 12:53 PM

View Postdoubledelight, on 31 July 2019 - 11:37 AM, said:

What about additional charges for extra repayments or early discharge of mortgage?  Are there any other ongoing fees associated with the servicing of the loan.

I'm pretty sure there's not but thanks, I'll double check

#18 born.a.girl

Posted 31 July 2019 - 01:27 PM

The only thing that bothers me is that they say it's a discount off their 'reference rate', which they state is 3.69.


On the Canstar website, their comparison rate is 3.22%.


What's to stop them next week saying their reference rate is much higher than the 3.69% quoted on their website?

#19 WaitForMe

Posted 03 August 2019 - 07:41 AM

Our broker just got in contact and reckons he can get us 2.99.

We currently have an offset so it will be interesting if thats included. Even if its not, its worth us moving. Only problem is, I just changed jobs and DH is self employed and didn't pay himself the last couple of months.

#20 IamzFeralz

Posted 03 August 2019 - 07:55 AM

I have 3.22% with an offset facility.  I like the offset because the interest rate is so low that my savings wouldn’t be earning anything in a normal savings account whereas they are effectively earning 3.22% as an offset against my mortgage.

With a redraw facility check the small print and ask the broker, I believe that the banks can possibly take funds from redraw facilities if they form the belief for whatever reason that it is doubtful you will repay the loan.  With an offset they cannot just help themselves to it.

#21 capper

Posted 03 August 2019 - 01:03 PM

I have 3.17% with no offset. With hsbc. No redraw fee if done online.  I also asked them to waive the application fees and they did. No ongoing fees.

#22 WaitForMe

Posted 04 August 2019 - 02:28 PM

Based on an offset rate of 3.5% and basic rate of 3.25%, you need to have at least 7% of the value of your mortgage in your offset account to break even.

The lower the offset rate, the more money you need in your offset to break even. So an offset rate of 3.00% and basic rate of 2.75%, you'll need 8.3% of the mortgage in your offset.

Its just worth considering as so many people aspire to save extra but in reality have very little in their offset. House prices may be reducing but they are still astronomical so the cost of interest on a mortgage is equally astronomical. And even if you do have a decent amount in your offset, you need to think about whether you really need all that money in the offset or perhaps just some of it for emergencies and the rest in a redraw facility.

We currently have ours in an offset but are looking to refinance, so I've been playing with numbers quite a bit lately and thought I'd share what I've learnt.

#23 born.a.girl

Posted 04 August 2019 - 02:34 PM

This article from Nicole Pederson is worth the read.


It answers a question I've had since seeing these non-bank lenders mentioned more frequently.

That is: if a non bank lender offers you an offset account, presumably you are not protected by the Federal Government's guarantee on bank deposits of up to $250k.

What then, if they go down the gurgler?  In that case, as per the article, you may well find your offset, that you've so carefully nurtured, gets offset against your mortgage.


https://www.theage.c...802-p52d99.html

#24 AliasMater

Posted 04 August 2019 - 02:42 PM

You really need to look at the whole package, not just the interest rate.

Our interest rate is a fair bit higher. We get a free offset and free redraw though, which saves a lot. We also get our credit card free which is the real deal breaker. Our Platinum Mastercard would otherwise be $399 a year. I earn about $1000 a year in gift cards by having and using it, as well as saving on travel insurances, extended warranty which we use, and more.

I have looked at moving our mortgage but I always keep coming back to the deal we have as probably the best for us pretty much regardless of the interest rate.

#25 WaitForMe

Posted 04 August 2019 - 03:07 PM

I dream of the day my mortgage is small enough to justify the $400 saving of a premium credit card fee...




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