Thoughts on Bendigo Bank rates & Adelaide Bank

Discussion in 'Property Finance' started by crulj001, 29th Dec, 2014.

  1. crulj001

    crulj001 Member

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    Hi All,

    After having our original PPOR and now IP with Bendigo Bank at quite a competitive rate for the last 7 years or so, we're now shopping for a new PPOR loan after purchasing some weeks ago in Melbourne. The new loan for PPOR only will be in the order of 600K.

    We've been happy with BB, and note in our area they sponsor many community initiatives, which I'm happy to pay a small premium for, however the question is, how much higher should one pay!

    Their current 'package plus' variable with 100% offset is advertised at 5.11%, which is a little higher than others (CBA 4.84%).

    Interestingly, the Adelaide Bank is also advertising 4.84%. As Adelaide & Bendigo is the same company, is it safe to assume their funding costs are the same? I would think a local Bendigo branch would match their affiliates offerings? Does this happen with CBA / Bankwest for example. Interested in people's thoughts....

    Cheers,
     
  2. SK Investments

    SK Investments Member

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    Hi,

    I have a loan with Bendigo Bank, but I still cringe at the premium I'm paying on Interest rates, plus monthly fees.

    Normally I'd use my MB, but having a good relationship with the branch manager made it quick and easy to secure the property, my MB didn't have a problem with it, he advises me either way.

    My loan is very low so I'm not losing too much with the interest rate difference.
    I'd suggest you get on to one of the mortgage brokers and find the best fit for your circumstances.
     
  3. DaveM

    DaveM KFC Buyers Agent

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    If your loan is 80% or under LVR, ask them to give you a better rate or you will refi elsewhere.
     
  4. Redom

    Redom Mortgage Broker

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    Heya,

    If rate is your major concern, try ubank or loans.com.au. They both have very good rates variable rates. You'd be getting sub 4.55% rates i think.

    May want to consider if it fits in with your overall plan (consider whether you need to cash out early, etc.). If it doesn't, may want to pay a little bit more and go to more suitable lenders.

    Fundings costs are usually a little cheaper for the big 4 banks. They have greater risk assessment frameworks in place that allow them to hold less capital for their exposures. This reduces the big 4's funding costs.

    I'm not certain on this, but their subsidiaries that don't have the same tools need to hold a bit more capital - increasing their funding costs. They end up being cheaper because of costs (e.g. it costs a lot more to run a CBA than an online only lender).

    Cheers,
    Redom
     
  5. Corey Batt

    Corey Batt Finance Broker

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    Rate isn't always the number one consideration, but it's not hard to beat Bendigo's offerings.

    Sub 4.8% should be possible on ~600k.
     
  6. Marty McDonald

    Marty McDonald Mortgage Broker Syd

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    Adelaide is essentially the broker channel for the group while bendigo is the direct channel. The cost of funds would be the same for the group but then the expenses between the two channels would be slightly different.

    5.11% is well over the odds for that loan amount assuming lvr under 80%. Why don't you see what they can do or approach the broker
     
  7. jpcashflow

    jpcashflow Member

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    Hi

    Hi Crulj,

    As you mentioned about one lender owning another, most lenders have their own profit and loss statement to follow. So most banks offer different products and rates to ensure there targeting the right market.

    When looking at a lender, don't always focus on the rates:
    Why? There are other things to consider, monthly or yearly fees, how easy are they to do with, what conditions do they have in terms of equity release and how do they secure your properties.

    If your looking for structure talk to a broker who can look at what you are doing now but also help you reach your goals for the future.

    I have also private messaged you some advice.

    Cheers
     
  8. crulj001

    crulj001 Member

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    Brilliant, thanks for the feedback. I always through Adelaide Bank was retail too, not just a channel for brokers. Interesting.

    Will see how things pan out this week after I speak with BB further. Thanks again.
     
  9. Marty McDonald

    Marty McDonald Mortgage Broker Syd

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    Used to be a retail bank before the merger.
     
  10. Corey Batt

    Corey Batt Finance Broker

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    They still are retail but it's a *******ised system, they attempted to expand their branch footprint without much success not all that long ago.
     
  11. Jamie_

    Jamie_ #1 Procrastinator

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    This is a public forum so why not post the advice publicly....
     
  12. caferacer

    caferacer Member

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    Perhaps try and push the local manager a bit with the rate, they might be able to offer you a bit more of a discount as an existing customer.
    Let them know that you're looking elsewhere and you want them to match or at least be in the market.
     
  13. Marty McDonald

    Marty McDonald Mortgage Broker Syd

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    maybe just in Adelaide / SA ?
     
  14. Jamie M

    Jamie M Mortgage Broker - Oz Wide

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    That's what I'd be doing.

    I know rate isn't the number one factor but Bendigo isn't generally a lender conducive to investors - so an external refi for a better rate isn't unreasonable IMO.

    Cheers

    Jamie