I never thought I'd see a Home Loan Interest Rate UNDER 3% in Australia!!

Discussion in 'Loans & Mortgage Brokers' started by Beachy, 31st May, 2019.

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  1. Beachy

    Beachy Active Member

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    Bank announces ‘gobsmacking’ 2.99 per cent home loan

    Crazyyyy!!! Maybe a sign of things to come with Interest Rate cuts

    "Greater Bank will offer the lowest one-year fixed rate home loan in the market, after announcing today that it will reduce the interest rate on it's Ultimate Home Loan and Great Rate Home Loan to 2.99%p.a.

    The new rates will be effective from Monday, June 3rd and available to new home loan customers or existing home loan customers wishing to refinance to a fixed term product.

    “As a customer-owned bank, we don’t have shareholders which allows us to redirect funds to directly benefit our customers. This is why we are in a position to offer the most affordable one-year fixed rate home loan in the market,” Greater Bank CEO Scott Morgan said.

    “This will ensure we remain very competitive against the industry’s major players in this fixed loan market.

    “These are the lowest fixed term rates I have seen in my time in the banking sector and the perfect opportunity for new and existing customers to look at their current financial position and considering fixing their home loan.”
     
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  2. paulF

    paulF Well-Known Member

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    Crazy indeed. The bank must be expecting the RBA to be cutting rates many times in the short term.
     
  3. Peter_Tersteeg

    Peter_Tersteeg Mortgage Broker Business Member

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    Ask yourself why they're quoting a comparison rate of 4.42% on an owner occupier property. 2.99% is a 1 year fixed rate. It's probably a loss leading offer to get you in with a more expensive back end.
     
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  4. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    U mean a B&S :)

    ta

    rolf
     
  5. Peter_Tersteeg

    Peter_Tersteeg Mortgage Broker Business Member

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    Is that Bait & Switch or Bull & ****? ;)
     
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  6. oracle

    oracle Well-Known Member

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    But from what you are seeing and reading you do anticipate it won't be long before we see low 3 rates (for OO & P&I) common among all majors?

    Cheers,
    Oracle.
     
  7. Speede

    Speede Well-Known Member

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    With super low rates...who would bother renting? I know some people don't have deposits or other reasons.... BUT.....you would be insane renting instead of buying.
     
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  8. TSK

    TSK Well-Known Member

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    Low rates like these are not a sign of a healthy economy. Also cheap credit has a tendency to increase prices or at least keep them at what one could argue are still high prices on some of the more "desirable" suburbs
     
  9. Speede

    Speede Well-Known Member

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    Does it really matter? If a person has a stable job with these super low rates that are coming.

    You wouldn't bother renting...even if prices drop another 5-10% it wouldn't matter if you look long term.
     
  10. Peter_Tersteeg

    Peter_Tersteeg Mortgage Broker Business Member

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    Do you mean fixed or variable? Fixed rates I think we'll see rates sub 3.5% fairly soon.

    For the past few months the banks have been fairly aggressive on fixed rate pricing but variable rates have only budged a little. Keep in mind that variable and fixed rates are funded differently, fixed rates aren't always a predictor of what the variable rates will do.

    Advantage (owned by NAB) has already gone to 3.29% on a 2 year fixed so we know the NAB are already getting that kind of funding. This could flow through any moment now.

    Variable rates have a bit more to go. A few lenders have cut variable rates recently. An RBA cut looks likely, but if the banks are true to form, they'll only pass part of it on. At that rate, it would take at about 2 rate cuts to see variable rates go below 3.5%.

    I think it's a fair way to go before we see variable rates starting with a 2. I hope it actually doesn't occur because that means the economy is really going backwards. It doesn't matter how low rates go if you don't have a job to pay the mortgage.
     
    oracle likes this.
  11. PandS

    PandS Well-Known Member

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    Unless your job is at risk, cheaper rate mean pay off mortgage sooner, any debt you have is cheaper so more money in your pocket and if you got any type of investment it drive up the asset price like crazy and you have an options to cash out, all seem pretty good to me.
     
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  12. Noobieboy

    Noobieboy Well-Known Member

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    While I understand that this economy is not powering through like crazy, I see it as a plus. If APRA and ASIC get it right, it could be a way to deleverage our highly indebted households.
     
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  13. Lacrim

    Lacrim Well-Known Member

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    But if you do have a job, it's a once in a lifetime opportunity to deleverage.
     
  14. Dean Collins

    Dean Collins Well-Known Member

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    Pffff 12 months.....ask them to match it for a 5 year etc.

    They are just sucking you in with a teaser rate knowing you wont go through the effort of leaving next year when they jack up rates.
     

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