will westpac increase rate if i refinance part of loan elsewhere

[flosed]

ex. i get 1.2 discount from westpac for 2M loan. Now i want to refinance 1m to other bank.

will westpac change my discount to 1.1 or 1 ?

Thanks

 

[Peter_Tersteeg]

Probably not unless you do something to wake them up. We're frequently having to go back to lenders to ask them to reprice older loans based on new lending.

I think it is in their T's & C's that they can do this, but I haven't known them to. Higher probability of a problem if the portfolio is cross collateralised though.

 

[Jamie M]

I don't think so - but it could come down to how the current loans are structured too.

Cheers

Jamie

 

[Terry_w]

I haven't analysed loan agreements over this but my understanding is that most of the time these discounts are for the life of the loan.

So one strategy is to start off with all loans at one bank, get the max discount, and then later move some loans to another bank(s) for safety.

 

[Redom]

Yep - my understanding from loan docs is that they're life of the loan discounts. Doubt they'll change it if its in your loan contract.

It is one way to get the best deal from individual banks, especially for what ends up being smaller loans (you could end up having sub 4.7% rates with the majors for small loans)...but the time and inconvenience cost of changing lenders probably isnt worth coming up with a strategy to manipulate this quirk.

Cheers,
Red

 

[Rolf Latham]

Youd be unlucky

we have a "few" mill under management and even where loans only part settle we havent had this issue with WBC .

Why the need to refi from them ??

ta
rolf

 

[Jamie M]

Youd be unlucky

we have a "few" mill under management and even where loans only part settle we havent had this issue with WBC .

Just a few ;-)

Cheers

Jamie

 

[Jamie M]

Yep - my understanding from loan docs is that they're life of the loan discounts. Doubt they'll change it if its in your loan contract.

Yep but they're not always in the loan contract - often pricing is loaded to existing accounts that aren't part of the immediate transaction and/or is done post settlement for some reason.

Having said that - I can't see them picking up on it and reverting your current rates back.

Cheers

Jamie