Browse Forums Home Finance 1 Oct 09, 2008 4:33 pm Hello, I have a general question.
What is a good interest rate for a home loan these days. So many around offering so many different rates. I am with the Police Credit Union and can get three years fixed at 7.98% then to variable rate of 7.94%. Are these rates good, and who is comparable to this. Would appreciate any response I am very new to all this new home stuff. Re: Newbie with Interest Rate Question 4Oct 09, 2008 10:16 pm Have a look at Rate City: www.ratecity.com.au
You can compare rates of different lenders and I find it's a good starting point when researching different home loans. Don't forget to have a look at the different features of each loan. The interest rate is important but you may find that loans with a lower rate may have high exit fees or no offset account. Winnie ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Built PD Regent 23 in Brimbank Gardens Interest Rate Question 5Oct 17, 2008 7:05 pm gilese What is a good interest rate for a home loan these days. So many around offering so many different rates. I am with the Police Credit Union and can get three years fixed at 7.98% then to variable rate of 7.94%. The rate you quoted is not bad, it probably doesn't have any fees being a credit union. But does it have a free offset account that is attached to your home loan which is a great feature if you usually have money in your savings account? It can save you years off your home loan term. 7.97% variable with a free offset account is a good rate. 7.69% fixed for 3 years is another good rate. These two are from a lender that has a broker distribution channel, which means you can get free service from a mortgage broker to source the loan. Not many credit union home loans are available through mortgage broker services. But that may not be important for you if you already have a great relationship with your financial institution on a 7 days a week basis. Some people even get their home loans through web sites owned by banks to lower their rates by 0.1%. A friend of mine did this and showed me her loan contract which has a nice clause "If you phone us for anything that is not covered by the FAQ section of our web site, we will charge you $70 per hour to answer your question." Nice touch Re: Newbie with Interest Rate Question 6Oct 17, 2008 7:50 pm I'm no expert but to me fixed rates are a bad idea in a number of ways.
First of all if the economy is slowing down there is every chance that a fixed rate could lock you in to a percentage higher than the current variable rate for the entire fixed period - rates could go down and you'll spend 3-5 years paying a higher rate than everyone else... They are a gamble either way - to me it's an even bigger risk than choosing a variable rate because you are relying on the bank under estimating the future variable rate by offering a fixed rate which ends up saving you money - not that likely if you ask me. But the main thing I don't like about them is that if you read the contract you will find that if you pay a loan off within the fixed rate period you are required to pay the difference between the current variable rate and the fixed rate for the rest of the fixed term. This can costs ten's of thousands of dollars. So not only are they locking you into a fixed rate but they are also locking you into a garrantee that you will not pay the loan out (in full or partially) in the fixed period. I'd avoid fixed rates like the plague if it were me. First home interest rate 7Oct 17, 2008 9:00 pm Yep, Fixed rate break costs are big. Not recommended if you think you may have to sell your property during the fixed term. They are great for borrowers who don't like change and are very stable themselves.
And you have to be stable and not planning to sell in the short to mid term if you are buying or building your first home. Some of my customers typically fix their interest rate for 3 years for that extra security in the first few years of home ownership. Re: Newbie with Interest Rate Question 8Oct 26, 2008 6:54 pm Here's a tip - always ask the following question:
Is the rate you are advertising the rate being paid by all current existing loans as well as for new loans. I know of one small lender who advertises a lower rate for new loans, while all existing loans are at a higher rate. In other words, after you take out your loan your rate will go up independently of their new loan rate. So you will never know what rate you will actually be paying from one month to the next. Its called bait advertising but try to get the lazy b*stards at the OFT involved and its all too much trouble for them. Re: Newbie with Interest Rate Question 9Oct 26, 2008 7:15 pm In the current climate I would not lock in a rate at 7.98%.
We have most of our loan locked for another four years at 7.3% ... I am fairly certain that bank rates will end up under 7% within the next six months. Really didn't see everything turning around so quickly, thought we were fairly safe locking the loan in for five years - how things change! Re: Newbie with Interest Rate Question 10Oct 27, 2008 6:20 pm Lyn Really didn't see everything turning around so quickly, thought we were fairly safe locking the loan in for five years - how things change! Hi guys, You said it! Not many people are fixing at the moment. The rates are plummeting. The fixed rates are currently lower than variable, which in my mind means variable rates are on the way down. Let's hope so as it will keep everyone happy. Re: Newbie with Interest Rate Question 11Oct 27, 2008 8:10 pm I signed up with commonwealth... my rate is 7.69% variable it is .12% cheaper for first 3 years and then moves up to economiser variable which is currently 7.81%.
That has no set up fees and no monthly fees.. so I thought it was a pretty good deal.. A person I know that is in the know reckons rates will keep dropping till about march and then they will start to rise again as everyone starts spending again!! I guess they can't keep going down forever!! First home buyer advice 12Oct 28, 2008 4:02 pm wakeboardandy I signed up with commonwealth... my rate is 7.69% variable it is .12% cheaper for first 3 years and then moves up to economiser variable which is currently 7.81%. That has no set up fees and no monthly fees.. so I thought it was a pretty good deal.. Yes 7.69%, many bank lenders are waiving set up fees on their BASIC LOW RATE home loan products. Basic low rate home loans are a very good alternative to PROFESSIONAL PACKAGE home loan products which have $24 per month or $300 to $395 annual fees to have a similar rate. With a Basic low rate loan from many bank lenders, you can have 7.62% (variable) and pay no ongoing fees. Re: Newbie with Interest Rate Question 13Oct 28, 2008 4:05 pm for those basic products - do you get a 100% offset account? After 4 years - we're in! 100% Offset Basic home loan 14Oct 28, 2008 4:19 pm stonecutter1309 for those basic products - do you get a 100% offset account? Hi stonecutter, there are horses for courses. As the name says they are BASIC. CBA one wakeboardandy named is the same. Having said that, I have one lender that has BASIC with 100% offset (to the best of my recollection, it is only one lender). Re: Newbie with Interest Rate Question 15Oct 28, 2008 6:20 pm I don't think I can have offset with mine.. but I just wanted to get into the housing market first so didn't really care what type of loan I got.. In 4 years time when there is no exit fee I will look at re-financing to a better deal. First home loan advice 16Oct 28, 2008 7:08 pm wakeboardandy I don't think I can have offset with mine.. but I just wanted to get into the housing market first so didn't really care what type of loan I got.. In 4 years time when there is no exit fee I will look at re-financing to a better deal. There is nothing with the CBA loan you have, 100% offset is good when you have spare cash. First home buyers typically don't have too much spare cash especially if they have kids. First home buyer 17Oct 29, 2008 11:21 am u9026a Here's a tip - always ask the following question: Is the rate you are advertising the rate being paid by all current existing loans as well as for new loans. I know of one small lender who advertises a lower rate for new loans, while all existing loans are at a higher rate.. I don't think your comment is limited to small lenders. Many banks have a policy of discounting for new applications only (new money, they call it). So they lose old customers to each other all the time. One bank representative was not shy about saying "Of course we don't ring up existing customers to offer them discounts". No Comment Re: Newbie with Interest Rate Question 18Oct 29, 2008 8:34 pm i think hsbc and westpac is advertising on their branch window 0.75% off variable rate, there is probably a package fee about $350 per year which should include no annual fee for gold card,no monthly fee and no est. fee. Variable rate is about 8.32%. homepath and onedirect online is usally pretty good. Re: Newbie with Interest Rate Question 20Oct 30, 2008 10:36 am After reading all the replies, either we were extremely lucky or we got a great deal. We have a loan with ANZ with 0.70% off standard variable, with 100% offset and no package fees or monthly fees. We've had our establishment fee refunded. The only fee I can recall ever paying is the progressive drawdown fee and the government discharge duties.
Another plus, is that I have access to a free overdraft account (just pay for interest, which for me is less than 20c/month), so I just leave everything in the offset account. a building inspector should be able to tell you about any major problems but we need a floor plan with dimensions to clarify options for extra bedrooms ... sometime an… 1 8727 You can really use anything you want the main consideration would be how it looks once painted/finished - or the look you want. Cabinetmakers use MDF because its cheap… 2 9962 I would say both styles you have pictured are steel. The lower chord of the first pic would be a massive lump if made using timber considering the size of the rafters. If… 1 6156 |