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Ask and you shall receive (maybe)

Discussion in 'Property Finance' started by Greyghost, 18th Nov, 2015.

  1. Greyghost

    Greyghost Well-Known Member

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    So we have gone through the apra changes of late. Investor rates went up. Most investors probably think that they do not any ability to obtain a sharper rate with their current lender.

    We are now seeing the re-entry of a few lenders back into the market.

    I have some of my portfolio with bank x. I simply emailed my personal banker and told her my owner occ rate elsewhere was significantly better, any chance of sharpening the rate on my loans with you guys?

    2 days later I got a reply with them shaving .4% off the variable rate.
    Then they asked if I wanted to bring more business across and they would consider further reductions. To be honest I was not dissatisfied with the rates in the first place either.

    May not apply to others situations, but I wanted to highlight that sometimes if you ask, you shall receive.

    I would be interested to see if other members tried this and see if they have similar success'
     
  2. Hockey Monkey

    Hockey Monkey Active Member

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    Was the reduction .4 or .04? Must have been a pretty high rate to start with for them to shave 40 basis points off.

    I had a similar conversation with my bank that resulted in 4 basis points being shaved off an owner occupier loan. Unfortunately days later they announced a 15 basis point increase due to APRA capital requirements. One step forward two steps back ;)
     
  3. Tranquilo

    Tranquilo Well-Known Member Premium Member

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    I'm with ING for my ppor at 4.66. I wonder if I can get that down. I suppose it depends on LVR.

    Anyway would I just ring them and ask to speak to who?
     
  4. larrylarry

    larrylarry Well-Known Member

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    Can I get my broker to do the same thing or do I need to speak to the bank myself?
     
  5. Jess Peletier

    Jess Peletier Mortgage Broker - Australia Wide Business Member

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    Broker can do it too. :)
     
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  6. Jess Peletier

    Jess Peletier Mortgage Broker - Australia Wide Business Member

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    It will depend on LVR. Ask to speak to retentions.
     
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  7. MattA

    MattA Well-Known Member

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    Central Coast NSW
    I'm currentlying with Westpac.

    Rang up the 13 number mid last week, said with the recent growth my property is now at about a 65% LVR (provided a comparable sale). Said I can move to ING who are currently offering this package, what can you do?

    Still waiting on the formal letter, but have verbally been told that I should be able to get an additional 20 points off. Bring it from 4.78 down to 4.58 I/O
     
  8. Greyghost

    Greyghost Well-Known Member

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    From 4.65 ( after the apra increases) back down to 4.25%.
    So I'm actually better off then when I first went to them. (Note the 2 properties I have with them are geared, hence slightly higher starting rate).
     
  9. Steven Ryan

    Steven Ryan Mortgage Broker Business Plus Member

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    Never hurts to ask, or have your broker do so.

    I negotiated a lifetime 0.33% discount on my PPOR loan with CBA after copping a five-figure break fee and basically saying "That hurt, can I have a rate discount to ease the pain?"?

    Happily, the rate discount saves me 2x the extra interest I have to pay due to the capitalised break fee. Worked out well.

    One thing to be mindful of is the offer of "bringing business across". Almost without fail lenders across the board offer better pricing discounts for larger total borrowings but there are risks associated with moving additional capital across to one lender, or having large chunks of it in the one place. All of those borrowings become susceptible to that lenders' policies (e.g. "cash out", interest rates etc) which can change at the drop of a hat.
     
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  10. Wukong

    Wukong Well-Known Member

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    Recently asked and PPOR rates is now 4.15%
     
  11. Azazel

    Azazel Well-Known Member

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    If you don't ask, you don't get.
    That's a pretty decent outcome, good on you.
     
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  12. Redom

    Redom Mortgage Broker Business Member

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    Definitely ask for it - if its PPOR lending they won't want to see you go, rates are quite low and you can force their hand better.

    Right now i get a lot of 'can i refinance for a better rate' enquiries. I often provide pricing requests for people trying to reduce their rate (refinancing because of rate is rarely the best option, negotiating a better rate is usually first best). It helps to have an offer in writing with a major competitor and let them know your leaving.

    With some lenders your best to go direct and speak to retentions - e.g. Westpac (at least in my experience with a few recent deals). Others like CBA, have your broker do it for you - will likely get the same result as their pricing team doesn't differentiate between the broker/direct channels.

    With someone like ING - they work their rates based on LVR. So your rate may be on an establishment LVR of 90%, but with new equity created over time, your LVR may be well below that. You should be able to request that rate based on the higher valuation if you can provide supporting evidence of it.

    So its often not just a matter of asking. Its how you ask. Few tips/random comments:
    1. Get a quote from a reasonable competitor. If your with Westpac, get one with CBA. A broker can assist providing you one free of charge (takes all of 5 minutes to do).
    2. If your rate is LVR dependent, than work out your actual LVR beforehand and use it as leverage.
    3. Do your research beforehand on the market. Don't bother quoting them loans.com.au or Ubank - use appropriate comparators reflective of the lenders competitors. E.g. Big 4 with Big 4, Big 9 with Big 9, etc.
    4. Note your negotiation room is better when you have more flexibility to move. If your portfolio is all crossed up and your part fixed, well, the bank knows that and knows your not going anywhere. The balls in their court then!

    Cheers,
    Redom
     
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  13. ADLInvestor

    ADLInvestor Well-Known Member

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    Location:
    Adelaide
    Currently waiting for a construction to finish with CBA, and then hoping to drop that rate to around 4.40%, which they have with their Economiser. Also have another that sadly fixed for another 3 years @ 4.99% with CBA.. Don't know whether it's worth asking about the break fee, or even a further reduction. We do have the wealth package - Thoughts?
     
  14. Wukong

    Wukong Well-Known Member

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  15. Steven Ryan

    Steven Ryan Mortgage Broker Business Plus Member

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    @ADLInvestor - Ask about the break fee. See what they say. Probably won't be pretty but no harm in asking and weighing up your options.

    I called CBA every day for months until my break fee dipped to what I thought was acceptable.
     
  16. Redom

    Redom Mortgage Broker Business Member

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    Hi ADL - why do you want to break? Is it to simply switch product between the economiser and the 3 year fixed?

    Unless its a PPOR debt sub 80% P/I - i don't think there's much benefit in breaking for purely monetary reasons. It makes sense if you need the equity and its stuck, etc (investment decisions).

    Cheers,
    Redom
     
  17. Tranquilo

    Tranquilo Well-Known Member Premium Member

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    Yeah baby. I asked and got from 4.66 down to 4.23. Also I got my original equity release down to 4.23.

    Thanks Jess I asked to speak to retentions.
    A big thanks to Redom for the competitors rates.
     
  18. Wukong

    Wukong Well-Known Member

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  19. Tranquilo

    Tranquilo Well-Known Member Premium Member

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  20. SouthBoy

    SouthBoy Well-Known Member

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    Ozland
    I think I am being taken for a ride by my broker. I have IP loans with CBA, Westpac and NAB. All at 90% LVR. NAB is charging me a whopping 5.05% variable rate after the recent increase. The other 2 charges around the 4.75% rate. My broker wasn't much help in getting further reduction. So I called CBA directly and they agree to give me a 0.10% reduction. Called NAB last week for a reduction and I am yet to hear back. I think that's poor service. I am seriously thinking of taking some my business to a non bank.