Fixed Rate loans..........

Was with ANZ, each bank would have a different formula but @big_ben02 pretty much summed it up.

 

0.15% looks really cheap. I fixed 1 year ago for 3 years at 3.89% OO PI. With two years remaining I’m now considering whether to give them a call as that pricing is really cheap. How can they possibly do it that cheap?

 

Just gave cba a call (1:15hr to get through) and they quoted me the break fee that’s approx. 1.8% of the loan amount. Still wondering how @big_ben02 got 0.15%?

 

Done quick calculation, even with that break fee if I were to break now and refix at 2.29% for the next two years I’d still be ahead by about $5300 over the 2 year period. Also, cba said that the break fee can be capitalised in the loan which is convenient as I was under impression that it had to be paid in cash/from transactional account.

Will give it some thought. But appears to be a no brainer even at that break fee.

 

Just checked with cba, investment io is 2.89 n pi is 2.69 for 1 2 3 yr, now thinking whether I should go for io or pi

 

Surely if CBA are saying they'll capitalise the break fee into the loan principal that's new lending = a full credit assessment?

I'd be up for it with some of my fixed P&I PPOR loans, but ING still applying 8% assessment rate I was told (!) Doubt I'd pass serviceability.

 

Can happen mate, I had a break fee of around $400 when I called once, left it a few weeks before going ahead and it was almost $5k. 1 interest rate drop can make a big difference.

 

That is what I see all the time. Its a study in human nature. People are only happy when they feel like they are getting a good deal the actual number is not as important.

 

2.29%'s a deal of a lifetime OR..

 

Nope as it's a fee

 

Would they still capitalise it (without some sort of assessment), if it took the LVR past 80%?

 

They said if the break fee is less then the amount already paid on the loan. So, technically no new lending I suppose.

 

NAB fixed rate announced today :

Access fixed home loan rates of 2.39 per cent p.a. for 1-year, 2.29 per cent p.a. for 2- and 3-year, and 2.79 per cent p.a. for 5-year (owner-occupier P&I), effective March 25. First home buyers will have access to a rate of 2.19 per cent p.a., fixed for two years. This delivers reductions of between 10 and 60 basis points.

These rates are underwritten by the RBA injection and only apply to owner occupied

 

Nothing spesh for investors?

 

No. The stimulus funding to banks is clearly not for investors as the Commonwealth are funding much of this. Its to assist those personally impacted and small - medium impacted businesses.

I would argue that a investor who seeks repayment concessions because of tenancy arrears faces a review of their whole portfolio and lending position. Lenders may refer these cases to "remedial teams" for management. LL insurance is a far better risk management strategy.

 

I'll ask (beg) anyway to get 2.29% on my inv loans. I've got millions with them - least they could do.

 

LOL... Sounds like investors are some kind of bad people in these environment.
Get SFA relief. Aren't we all mum's and dad's trying to get ahead and not rely on the government handout?

 

@Brady If you work with CBA is that usually the case that the break fee can fluctuate that much in such a short period of time (e. g. days or few weeks)? Or is it more or less the same over a short period of time?

 

i fixed most of mine at 3.99% in june 2019 for 3 years.....

 

@Rolf Latham From you experience, are the break fees that people may get today vary a lot from those that were available yesterday? If so, what’s the reason for it? Thanks in advance!