ME Bank sharpen fixed mortgage rates by up to 0.40%
ME Bank has joined the swelling ranks of lenders making cuts to short-term fixed home loan rates by reducing a number of offers between 20 to 40 basis points.
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Home loan refinance: 94% of mortgage holders could be losing out by failing to switch
Five Reserve Bank rate cuts in the past 14 months have accelerated home loan rate cuts across the board, yet only a fraction of Australian households have taken up the opportunity to refinance their mortgage.
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86 400 launches new tiered variable rates to help borrowers save
Australian neobank 86 400 has announced it will be offering tiered variable rates for home loan customers, giving those with a lower LVR (Loan to Value Ratio) the chance to access cheaper rates.The new pricing system means borrowers with a deposit of at least 40% of a property’s value can pay as little as 2.59% p.a. (2.87% p.a. comparison rate*). According to 86 400’s lending product lead, Melissa Christy, this will go a long way towards freeing up customers’ finances."We built 86 400 to help Australians take control of their money. By reducing the variable loan rates for customers with more equity in their property, we are helping our customers do more with their money,” she said.The new rates came into effect 20 August 2020, and will be available to all customers, including existing ones. The tiers and accompanying rates for owner occupiers making principal and interest repayments are listed below:• LVR ≤ 80%: 2.74% p.a. (3.02% p.a. comparison rate*)• LVR ≤ 70%: 2.64% p.a. (2.92% p.a. comparison rate*)• LVR ≤ 60%: 2.59% p.a. (2.87% p.a. comparison rate*)Investors will also be able to take advantage of the new pricing system, with rates as low as 2.89% p.a. (3.17% p.a. comparison rate*) available. Below are the price bands for investors making principal and interest repayments:• LVR ≤ 80%: 3.09% p.a. (3.36% p.a. comparison rate*)• LVR ≤ 70%: 2.99% p.a. (3.27% p.a. comparison rate*)• LVR ≤ 60%: 2.89% p.a. (3.17% p.a. comparison rate*)While rate discounts by LVR are nothing new, they’ve become more popular in recent months as lenders look to peel away low-risk refinancers from competitors. A lower LVR means borrowers are less likely to enter negative equity territory and be forced to sell during a downturn. 86 400 is also offering $2,000 cashback on settlement for eligible borrowers. The offer is available on applications of $250,000 or more, so long as they are received by 31 August 2020 and settled by 31 October 2020.For more information, read our review for the 86 400 Own Home Loan. And if you’re wondering how the rates on offer compare to others on the market, browse our home loan comparison page, where you’ll be able to filter your search by rate and type.
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Property buyers delay plans due to COVID-19, finds Gateway Bank
Fifty-two per cent of first home buyers have delayed their plans to purchase property due to the COVID-19 pandemic, according to new findings from Gateway Bank. Meanwhile, 16% have put their plans on hold indefinitely.“As more people are being forced to spend their deposit savings on basic living expenses, the prospect of buying a property is now even more elusive,” said Gateway Bank chief executive officer, Lexi Airey. In a survey of 700 Australians hoping to buy their first home, Gateway Bank found that half have been forced to dip into their deposit savings. Of this group, 45% did so to cover day-to-day expenses, while 17% used their savings to help a family member experiencing financial stress.Perhaps most shocking, 16% of potential first home buyers admitted to draining most of their deposit in the months since the pandemic struck.For many, recovering lost savings won't come easy, especially at a time when job insecurity is on the rise and ties to employment are only being preserved through government largesse.In fact, according to the research, 56% of first home buyers believe it will take them an additional one to three years to save up a deposit, while 25% expect to be saving for at least another three years.
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Home loan question: Is a short term fix just what you need?
If you haven’t noticed already, fixed home loans are well and truly back in vogue in 2020, largely replacing the spot previously occupied by variable home loans in offering the sharpest rates on the market.
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August cashback offers: find the best in borrowing, banking and insurance
Everybody loves a little extra money in their pockets, and cashback offers have been flying through the door with providers looking for enticing ways to reward new customers during the pandemic down-turn. Many of them are offering generous rewards for things like switching your home loan, opening a new bank account, grabbing a new credit card and even taking out a new car insurance policy. With cashback offers reaching the thousands, now might be time to consider finding a bargain and being rewarded for doing so. To help you cash-in the bonuses, check out our round-up for this month and see where you could score a little spare change.
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COVID-19 has made it harder to get a home loan. How can you improve your chances?
In response to growing credit quality risks, banks have made some pretty big changes to the way they assess mortgage applicants. Some have begun asking for larger deposits. Others have ruled out lending to casual workers. All are exercising a lot more caution when dealing with those from vulnerable industries.So while interest rates are at record lows and property prices are beginning to dip, for many the path to home ownership now contains more obstacles than ever. Below, we look at some of the main ways banks and lenders have tightened their lending practices, and what you’ll need to do to get your application over the line.
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Mortgage deferral deadline: ASIC lays out expectations as September nears
Australian corporate regulator ASIC has issued advice to mortgage lenders as the clock begins to tick down on the hundreds of thousands of home loans that have been deferred during the COVID-19 pandemic.
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Suncorp extends $2,000 home loan refinance cashback
Aussies looking to save money on their home loan and earn $2,000 cashback into the bargain will be pleased to hear that Suncorp has extended its popular refinance cashback offer to give more borrowers the chance to switch and save before the offer ends on 30 September.
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NAB rate cut: Big bank takes lead on investor home loans
As competition in the home loan market continues to heat up, NAB has cranked things up a notch. The bank’s move this week to slash variable rates for investors has made its offer the best among the big four.The interest rate for the NAB Base Variable Rate Home Loan now sits at 3.09% (3.09% comparison rate*) for investors with a loan-to-value ratio (LVR) of 80% or less and making principal and interest repayments. For context, LVR refers to the percentage of property value you’re borrowing from the bank. So if you’ve saved up a 20% deposit, then your LVR would be 80%.NAB’s five-basis point cut places it just ahead of ANZ’s rate of 3.12% (3.16% comparison rate*), available on its Simplicity PLUS home loan for investors with a maximum LVR of 80%. NAB’s latest rate reduction also further widens its gap with Westpac and Commonwealth Bank:
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