Thanks tobe, will have a look at Ubank. Pretty much rate driven at the moment unless the rates are only marginally different.
loans.com.au - 4.75%
- Thread starter jackbak
- Start date
Thanks tobe, will have a look at Ubank. Pretty much rate driven at the moment unless the rates are only marginally different.
Thanks PT_Bear
It might sound irresponsible but I'm not overly worried about GFC part 2, if I was too worried about it I wouldn't be buying at all and I think it's best to get on with life.
youd better get a new broker thensomeone like John Mardell who is on this forum will be able to get you a 4.8% effective rate with a mainstream lender.
Also be mindful if the loan will have a fairly substantial amount in redraw in it ie, your money.................. take a careful look at the redraw conditions - often this is what sways people to look at a lender with a banking licence in a separate and discrete offset account
another small challenge will be that many of the smaller RMBS sourced lenders had issues with larger loans since they need to get mortgage insurance cover.
Another thing these bearing in mind is the valuation - most of these lenders will not lay to do upfront valuation. So you go through the entire process and find that they don't share your opinion
ta
rolf
Thanks rolf that's great. Ill have most of my money sitting in the offset account so shouldn't need to use the redraw facilities. WIll have a look around for John Mardell, if he can get 4.8% then I'd definitely go with a bank.
Cheers
funny you should say that
HSBC broker sold their book to Firstmac ( who owns and funds loans.com.au)
I can guarantee you that they product base did NOT remain the same, and in my experience of my client base, I believe the quality and USE of the product was badly eroded.
Doesnt matter in this specific instance, but clarity with this sort of stuff might be handy for those that read this thread in the future.
I would also suggest that its not as simple to switch lenders as our Current Albatross suggest, sure for an average Ma n Pa with a moderate loans and lowish LVR the risks of poor vals or other reasons while "life is what happens to you while you are making other plans"
Finally, the very fact you are seeking some user feedback implies that there is some doubt there with you personally usng this product Pay heed to that niggle and do your research as you are doing.
personally, Loans.com and Ubank, state custodians and the other also rans have their place - its a client decision at the end of the day, and quite often these lenders are very very suitable for the narrow niches they have.
ta
rolf
its a redraw ............. it may be "separate" but its a redraw and falls under the T&Cs for the redraw for that lender.
By definition, a non bank lender can not have a savings / offset account because they arent a licensed deposit taking institution.
Again, its most likely a moot point, but when push comes to shove YOUR money in their redraw makes your money THEIR money, and like with most things in life, it wont happen to me..............
ta
rolf
Should be able to get 4.8% or less, depending on some details related to the deal.
Loans.com.au may be OK for people who are looking for NO frills, without any ideas of multiple properties.
Pete/Rolf etc have touched on what happened during the bad times of the GFC with certain lenders (including the 'owner' of loans.com.au)
Loans.com.au may be OK for people who are looking for NO frills, without any ideas of multiple properties.
Pete/Rolf etc have touched on what happened during the bad times of the GFC with certain lenders (including the 'owner' of loans.com.au)
ask Ausprop what happened to his portfolio.
Thanks rolf, that's very interesting and no one I've spoken to has pointed this out to me yet. So are you saying if I had $200k in my offset/redraw account and the bank went belly up, then this would be their money and I'd potentially loose it? Also, are you saying it would be a different scenario if it were a bank and not a non bank lender?
Thanks
jackbak
If the bank goes belly up, you'll forfiet the amount of money you've got in the redraw (it's not a real offset account). The good news is that you'd owe less money.
The reality is a little worse however. Most lenders have in the fine print that they can cancel the redraw at their discression. It's not something they do lightly (due to bad publicity I suspect), but they can do it if they feel it's in their interests.
An offset account and a redraw facility are also treated quite differently for tax purposes. It's possible that some lenders have private rulings on this, but I've yet to be informed of that by a lender.
The reality is a little worse however. Most lenders have in the fine print that they can cancel the redraw at their discression. It's not something they do lightly (due to bad publicity I suspect), but they can do it if they feel it's in their interests.
An offset account and a redraw facility are also treated quite differently for tax purposes. It's possible that some lenders have private rulings on this, but I've yet to be informed of that by a lender.
Im not saying anything, I refer you to the terms and conditions of the lender.
All im saying is that an offset as a discrete account with a lender is YOUR money, and you usually have control over that.
Money in a redraw is usually the banks money and at their disgression if they release it .............
tarolf
A few points worth considering. loans.com.au is wholly owned and funded by Firstmac.
1. Firstmac is funded by RMBS - and the AOFM is its largest cornerstone investor. They have several billion in RMBS in the market and never hiked their rates on clients during the GFC. They maintained the 'average" of the 4 majors at all times.
2. All the majors use RMBS for a very significant amount of their loan book, also.
3. I think you'll soon learn ( when they announce it) that Firstmac now has control of an ADI - so the "banking" side of their products will soon be quite legitimately bank products. But for years, they've been able to operate products that for all intents and purposes look and feel just like bank offset accounts etc.
4. Borrowing capacity ( if you are worried about building a portfolio) is significantly better with these guys than with many, many majors and other lenders
5. UBank's product is pretty basic. Great for a set and forget, ultra low rate- but the online banking, redraw etc is pretty basic ( I'm being polite- it's actually beyond basic)
6 I know all this because I worked for one of them for years, and have had loans with the other of them for years
7. The bottom line is - the loans.com.au product is fine. Whether it's fine for you, only you can decide. But whichever loan you decide is best for your needs, there's certainly no reason to be frightened of this particular brand or product
1. Firstmac is funded by RMBS - and the AOFM is its largest cornerstone investor. They have several billion in RMBS in the market and never hiked their rates on clients during the GFC. They maintained the 'average" of the 4 majors at all times.
2. All the majors use RMBS for a very significant amount of their loan book, also.
3. I think you'll soon learn ( when they announce it) that Firstmac now has control of an ADI - so the "banking" side of their products will soon be quite legitimately bank products. But for years, they've been able to operate products that for all intents and purposes look and feel just like bank offset accounts etc.
4. Borrowing capacity ( if you are worried about building a portfolio) is significantly better with these guys than with many, many majors and other lenders
5. UBank's product is pretty basic. Great for a set and forget, ultra low rate- but the online banking, redraw etc is pretty basic ( I'm being polite- it's actually beyond basic)
6 I know all this because I worked for one of them for years, and have had loans with the other of them for years
7. The bottom line is - the loans.com.au product is fine. Whether it's fine for you, only you can decide. But whichever loan you decide is best for your needs, there's certainly no reason to be frightened of this particular brand or product
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See this is where I should bite my tongue but don't.
1. This is hardly a "no frills" product. It has multiple splits, P & I or I/O ( 10 years) and an Offset. ( debate whether its a redraw or an offset, but for all intents and purposes its an offset in its function - i.e direct salary crediting, visa debit card, telephone and net banking) They have a good online banking site, and they have local support people to take your calls.
2. Borrowing capacity - they take neg gearing and actuals on all existing debt, for borrowing capacity - so they as good or better an better option for building a portfolio than the majority of lenders in the market.
3. The "owner" of the brand is Firstmac, and are you suggesting they went under during the GFC? Or hiked rates during the GFC? ummm...no. They secured AOFM as an investor in their RMBS, they moved their rates in line with the average of the majors, and those are the facts. You're free to have a crack at RAMS or GE or Macquarie, but neither Resimac nor Firstmac ( nor ING, nor Adelaide ) did the dirty on people during the GFC.
Im not suggesting the OP uses loans.com.au for their needs, but lets at least try and be fair and accurate in our commentary
That's cause Resimac does the dirty on people all the time, not just GFC
I'm inclined to agree. I'm aware that Firstmac has some very compeditive products, but I've also seen a lot of borrowers with loans from these lenders on obscenely expensive rates.
Firstmac and Resimac do deal with brokers, their renumeration structure is compeditive. Yet they've never rated very well (compared with other lenders) for broker volumes.
But this is no different to a Big 4 bank is it? Some on great rates some on terrible rates.
From what I see it just seems that places like Firstmac have more extreme's at either end, IE the ones on good rates are on fantastic rates and the ones on bad rates are really bad. But from my point of view as long as I'm on a good rate then what they charge their other customers is irrelevant.
Well to be honest - who does rate well for volumes? Besides the majors I mean. Brokers write more than 80% of their business with just 3 or 4 lenders. I know, I know- everyone's going to say "I don't... I use lots of different lenders "... but if that's true, why is about 80% of business , month on month, year on year, going to just 4 lenders ?
Anyway- the online threat is not much of a threat to brokers yet... but its growing
I see growth in online lenders as an opportunity.....................not a threat
ta
rolf
Yep I agree.
Each broker has their preferred lender. Let's not forget that the majors now control a lot of the small players who were always broker-dependent - like Bankwest, St George, RAMS, Advantedge etc. I personally write most of my business to 4 lenders, use some others occasionally depending on the situation, and avoid others like the plague. The fact that the majors still have a large portion of the market is, I think, more a reflection on the smaller lenders than on the majors. For example, 2nd tier lenders like Adelaide Bank tend to charge a lot more than their contemporaries but offer exceptional products for certain type of individuals, therefore targeting a niche market rather than a broad mainstream one. This impacts their volumes, of course.
I am not worried about online lenders. I think home loans are more of a service than a product - and you can't substitute online for communication with a real person. Those who treat home loans as mere commodities are the rate seekers and those are the people that the UBanks/firstmacs cater for.
Let's not forget that they are lending you the money, not the other way around. So the 'risk' is less than if you were depositing money into a RMBS fund.
