Loans.com.au

[Issac_37]

Morning all,
wondering if anybody has had any dealings with this company (www.loans.com.au) and their loans products, particularly "the dream loan express". They seem to be offering attractive rates and terms, namely:
1/ 6.69%pa variable
2/ offset account
3/ no annual fees
4/ rate linked to RBA movements for the next three years.

I have emailed my current loan provider to see if they can offer better terms. Can anyone think of anything I may be overlooking in this deal? Sudden rate increase 3 years later?

I have searched the forum but can't seem to find any reference to this company or their products...

Cheers,

Issac

 

[Rolf Latham]

A division of Firstmac

ta
rolf

 

[Terryw]

Make sure it is a real offset account and not just a redraw facility.

 

[Aaron_C]

The rates only apply if you fit their strict criteria. It's not for everyone.

 

[Issac_37]

Thanks for your replies.

Terryw, upon further investigation, the "100% redraw offset account" they describe on their website is in fact a "100% redraw offset facility," which is of no use as the interest can't be claimed on tax in years to come if i redraw and use it for non-investing purposes.

Are banks the only typical institutions who offer the full offset account? (having spoken to loans.com.au, they mentioned that as they arn't a lending institution, they legally can't setup this type of offset facility?)

Looking at a 6.99% offer with a offset account from Macquarie. $398 annual fee. Does this sound reasonable?

Cheers,

 

[Rolf Latham]

Hi Issac

6.99 may be ok, much depends on the loan volume AND your capacity to service the debt, the LVR etc

I could be wrong bu I recall that the new Macq is rebadged ABL money
ta
1

rolf

 

[Aaron_C]

Yes an offset account is a 'financial product' whereas a home loan is merely 'credit'. Macquarie is a good lender if you want cash-out on your home loan

 

[martino]

Thanks for your replies.

Terryw, upon further investigation, the "100% redraw offset account" they describe on their website is in fact a "100% redraw offset facility," which is of no use as the interest can't be claimed on tax in years to come if i redraw and use it for non-investing purposes.

Are you sure?

I understand the "100% redraw offset" to be a separate account with a VISA debit card attached - I'm about to finalise a refinance with them and this is what they have told me on several occasions.

Perhaps I'm misunderstanding what you are saying.

Another thread on the lender - http://www.somersoft.com/forums/showthread.php?t=71947

 

[Issac_37]

Evening all,

Martino-I have spoken to them and they explained that the facility is a re-draw facility and NOT and offset account. This was backed up by their example when I pressed them on the issue;

$100k loan
$20k lump sum paid back sometime after the loan is setup.
New balance is $80k. (with the ability to re-draw $20k back up to the original $100k.)

Perhaps I was speaking to someone who didn't fully understand their product?

I am interested to hear what different advice you have received?

Cheers,

 

[Peter_Tersteeg]

Every lender I've ever spoken to that is not a 'deposit taking institution' that claims to have an offset account, doesn't really have one.

Like Issac states, it's really just a redraw facility on the loan, which is quite standard for variable loans and a far cry from an offset account and treated very differently from the ATOs point of view.

It's unlikely that the person on a help desk has the knowledge to truly understand the difference. They usually have a good understanding of what's in the manual they've been given (policy, procedure, etc) but they do not have an understanding of the nuances of investment lending. This simply doesn't appear in any lenders manual.

 

[Terryw]

Lucky you did the research, otherwise it could have been costly down the track.

 

[martino]

Martino-I have spoken to them and they explained that the facility is a re-draw facility and NOT and offset account. This was backed up by their example when I pressed them on the issue

Quote from my lending manager:

This loan has both options the 100% offset account and the redraw facility

Quote from another consultant earlier on in my application process:

The offset account is a redraw offset account
- This means its an account where you place funds, either savings or you can have your pay direct credited or, other one off deposits
- The balance is 100% offset against the loan balance on a daily basis
- You can access your funds via EFTPOS, ATM, BPay, Phone and Online
- There is no minimum withdrawal (re-draw) and no fee (there are excess ATM fees over 5 per month) if used correctly by withdrawing cash when using EFTPOS transaction this is unlimited and no fees
- This is the account to which the visa debit is linked

- You can also make additional payments direct to the loan and you can make lump sum payments
- You can redraw these excess payments from the loan
- No minimum amount, no fee
- Access is via phone and online
- The visa debit is not linked to the loan

Would be interested to hear opinions from people here on the above. It seemed pretty clear to me that I'd be getting a separate account for the 100% offset but now I'm not so sure.

 

[Terryw]

Quote from my lending manager:

This loan has both options the 100% offset account and the redraw facility

Quote from another consultant earlier on in my application process:

The offset account is a redraw offset account
- This means its an account where you place funds, either savings or you can have your pay direct credited or, other one off deposits
- The balance is 100% offset against the loan balance on a daily basis
- You can access your funds via EFTPOS, ATM, BPay, Phone and Online
- There is no minimum withdrawal (re-draw) and no fee (there are excess ATM fees over 5 per month) if used correctly by withdrawing cash when using EFTPOS transaction this is unlimited and no fees
- This is the account to which the visa debit is linked

- You can also make additional payments direct to the loan and you can make lump sum payments
- You can redraw these excess payments from the loan
- No minimum amount, no fee
- Access is via phone and online
- The visa debit is not linked to the loan

Would be interested to hear opinions from people here on the above. It seemed pretty clear to me that I'd be getting a separate account for the 100% offset but now I'm not so sure.

"Redraw offset account" makes me think it is redrawing from a loan account.

Ask them does the offset and loan have separate account numbers

 

[martino]

Terry - thanks.

I'll confirm with them whether two account numbers are provided, that's really the clincher. I interpreted that this was the case from their answers, but I need to know for sure now after reading conflicting info from others!

 

[Issac_37]

Terry - thanks.

I'll confirm with them whether two account numbers are provided, that's really the clincher. I interpreted that this was the case from their answers, but I need to know for sure now after reading conflicting info from others!

Sounds good. Haven't been meaning to introduce doubt directly, just pointing out that when I inquired I was given a different story. Hope it does turn out to be a proper offset account because the terms seem substantially better then other offers on the market.

Let us know the outcome.

 

[somersoftfan]

Hello all,
I am reasonably new here but I started loving this forum. Thanks for all the knowledge that you guys are sharing.
I am a new customer of loans.com.au and I can provide you details of facilities they provide with their account.
They provide 2 external accounts (with BSB) one for loan and one for offset. Offset is 100% offset. But I don’t know what would be the issues since their redraw offset account is not protected by Govt. Guarantee.

 

[Spectre]

3 threads in a row near back to back for loans.com.au with virtually new members... if I didnt know better...