If you're with Westpac, CBA, NAB, ANZ etc, I guess it makes no sense to lock now?

OK I have a LOC against my PPOR. I used it to buy IP's. Can I refinance that as an OO loan as it's against my PPOR?

What IS the current variable loan for OO and for Investments? Thanks.

 

It's not quite that simple.

It might be possible to negotiate better rates depending on the lender, but the existing loan wasn't for owner occupied purposes. Some lenders will give you a better deal on it, some won't.

The variable rate for various loans changes from one lender to another, in some cases quite dramatically. It can also vary a lot if you want P&I or IO repayments. There's no single answer, it depends on the lender and it depends on how much you've borrowed, the LVR and to some degree the lenders risk assessment of you.

 

Thanks @Peter_Tersteeg Most of my loans are coming off fixed and I'm trying to decide which ones to fix (I want some security against rises). It's very confusing. The LOC is with St George and it used to be .1% dearer than a loan, now it's cheaper so I'm looking at fixing that. My LVR is very low and they are all IO.

So this is where it gets frustrating. I hear blanket statements- I get ??% discount but what does it mean if it's off something intangible? How do you assess if that actually means anything? No one will say what rate they are getting so people can compare whether to switch their alliances.

 

The discount is off the advertised rate for the individual lender, so a 1% discount from one lender may be great, where 1% off another lender may not be all that competitive. Rather than being too focused on rate, it makes more sense to choose the best lender in terms of policy and then negotiate the best rate possible from that lender.

It can be worthwhile changing lenders for rate IF it also is conducive to your longer term plans, however there is a cost to refinancing so you want to sure there's long term benefit and not just an immediate rate saving.

 

It doesn't mean anything. It really frustrates me when someone comes to me and says my friend is paying x.xx% with this bank, why can't I get that?

They don't know how much their friend borrowed, what LVR is was, how many properties were involved, when the deal was struck...

There's threads on this forum where people announce the great deal they got, again they don't share the full details and frankly most people here don't understand the complexities and continually changing lending environment.

The deals we're negotiating now are very different to what we were negotiating 12 months ago. The lenders we're recommending are different. If you're going to listen to someone, listen to those who do it every day, not those who are talking to lenders somewhere between once a year and once a decade.

Don't ask people to compare their rates here, talk to a good broker (plenty here) about the specifics of your lending circumstances and get properly qualified advice.

BTW, at the moment the St George LOC can be negotiated to a more competitive deal than their investment loan. You could also fix at a very competitive rate, but make sure you understand the implications and limitation of this.