NAB - 0.29% for all interest only loans - IP and PPOR

Discussion in 'Loans & Mortgage Brokers' started by Mick C, 27th Jul, 2015.

Join Australia's most dynamic and respected property investment community
Page 1 of 3
  1. Mick C

    Mick C Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    206
    Location:
    Sydney
    DAME!!! from NAB....

    =====

    Variable and fixed rate changes - coming soon


    We’re making changes to our variable and fixed rates. These changes are in response to industry and regulator concerns to temper growth in investor lending.


    What’s changing?

    • Interest rates on Interest Only (Investor and Owner Occupier) home loans and Line of Credit facilities will be increasing by 29bps, effective 10 August 2015 for new customers.
    • Interest Only fixed rates for new customers will also increase by 29bps, effective 10 August 2015.
    • Existing variable rate loans with Interest Only repayments will increase by 29bps for the duration of the Interest Only period, effective from 10 September 2015.
    • Existing interest only applications impacted by the recent increase to investor pricing will be adjusted accordingly to reflect a total 29bps increase.
    More information & updated interest rates
     
    Mick C, 27th Jul, 2015
    #1
    wategos and poeter like this.
  2. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

    Joined:
    18th Jun, 2015
    Posts:
    42,005
    Location:
    Australia wide
    Whats the world coming to?
     
    Terry_w, 27th Jul, 2015
    #2
    leon brown likes this.
  3. Kelly88

    Kelly88 Well-Known Member

    Joined:
    27th Jul, 2015
    Posts:
    75
    Location:
    Sydney
    Is it possible for people with investment loans to refinance to e.g. loans.com.au or other online lenders ? I still see loans.com.au advertise their rate as 4.02% ? What is the disadvantage of refinancing with them instead of remaining with CBA or NAB ?
     
    Kelly88, 27th Jul, 2015
    #3
  4. Natedog

    Natedog Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    373
    Location:
    Brisbane
    Wow!

    In a bad way.....
     
    Natedog, 27th Jul, 2015
    #4
  5. almostthere

    almostthere Well-Known Member

    Joined:
    22nd Jun, 2015
    Posts:
    88
    Location:
    Sydney
    Scary start:mad:
     
    almostthere, 27th Jul, 2015
    #5
  6. Mick C

    Mick C Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    206
    Location:
    Sydney
    I would wait a bit first....what happens when you refinance the online lenders also follows ( they dont need to as not regulated by ARPA...but can do so to get a bigger cut in the profit...)

    I would def consider smaller banks and online banks after a couple of weeks once all the rate policy are announced
     
    Mick C, 27th Jul, 2015
    #6
  7. poeter

    poeter Active Member

    Joined:
    2nd Jul, 2015
    Posts:
    30
    Location:
    NSW
    I think this would depend on how much your leveraging.

    Is refi cost worth the switch for a lower rate?
     
    poeter, 27th Jul, 2015
    #7
  8. Kelly88

    Kelly88 Well-Known Member

    Joined:
    27th Jul, 2015
    Posts:
    75
    Location:
    Sydney
    Just amazing that loans.com.au can have 4.02% .... Anyone has an experience with them ?
     
    Kelly88, 27th Jul, 2015
    #8
    shorty likes this.
  9. Arashi87

    Arashi87 Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    103
    Location:
    Sydney
    I've just submit application to NAB 4.63% variable which got pre approved before policy change. Should I change it?
     
    Arashi87, 27th Jul, 2015
    #9
  10. RetireRich101

    RetireRich101 Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    2,149
    Location:
    Sydney
    If the 'dislike' icon is active, you will get 100000 dislike for a single Post :p

    I note:
    • Existing variable rate loans with Interest Only repayments will increase by 29bps for the duration of the Interest Only period, effective from 10 September 2015.

    This is bit different to ANZ, Mac and CBA? So for my IP loan, if I elect to switch my IP Loan to P&I, then I am not affected (for now) and still maintain my already 'negotiated' discount?

    do nothing, refinance, change to P&I, fixed for 2-3 years....so many options to think about?

    would people consider change to P&I until the APRA saga is done and dusted in the next 1,2 few years?
    In a way I thought NAB response to APRA is more creative than others.. thoughts?
     
    RetireRich101, 27th Jul, 2015
    #10
    almostthere likes this.
  11. poeter

    poeter Active Member

    Joined:
    2nd Jul, 2015
    Posts:
    30
    Location:
    NSW
    I don't think the negotiated discount changes.
     
    poeter, 27th Jul, 2015
    #11
  12. leon brown

    leon brown Well-Known Member

    Joined:
    21st Jun, 2015
    Posts:
    64
    Location:
    nsw
    what are the odds of regulated lenders switching all I/O loans to P/I regardless of the
    remaining I/O period ?
     
    leon brown, 27th Jul, 2015
    #12
  13. Mick C

    Mick C Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    206
    Location:
    Sydney
    1. No changes t your "negotiated discount" regardless of changes or not..
    - NAB will just increase the rate for their " interest in arrears loans" ( that's the name of the loan for I/O with NAB)

    2. Is 0.29% worth the P/I?? plan ahead please....tax reasons? servicing?
    - If you make it an IP in the future you will have less tax deduction
    - Reduce servicing and possibly equity
    - Rate changes all the time....
     
    Mick C, 27th Jul, 2015
    #13
    RetireRich101 likes this.
  14. Mick C

    Mick C Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    206
    Location:
    Sydney
    low chance...as the contact that was signed was for 5 years I.O etc...
    A contract is a contract at the end of the day..
    So hence negotiated discount can't and wont change as well...unless a new contract is drawn up.

    Note All banks contract does state the "standard variable rate" ( ie reference rate) Can change at any time at the banks discretion.
     
    Mick C, 27th Jul, 2015
    #14
  15. RetireRich101

    RetireRich101 Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    2,149
    Location:
    Sydney
    @Mick C, this applies to existing fixed rate period, that any bank would not go near and change the rates, terms/condition within a fixed rate period?
     
    RetireRich101, 27th Jul, 2015
    #15
  16. Till Kingdom Come

    Till Kingdom Come Well-Known Member

    Joined:
    23rd Jul, 2015
    Posts:
    129
    Location:
    Aussie Aussie Aussie Oi Oi Oi
    Online lenders have a limited funding source. Their funders in the debt capital markets are demanding higher margins, just based on latest deals I've seen in the securitisation market.
     
    Till Kingdom Come, 27th Jul, 2015
    #16
  17. Johann_

    Johann_ Well-Known Member

    Joined:
    1st Jun, 2017
    Posts:
    374
    Location:
    Melbourne
    You will find that loans.com will tighten or if not pull out of investing lending.
     
    Johann_, 27th Jul, 2015
    #17
  18. Mick C

    Mick C Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    206
    Location:
    Sydney
    Yep.
    Fixed rate contracts are the same as variable with the extra " break cost and fix period" clauses added.

    ^ Spot on...
    Rates with online lenders will go up...some without notice for existing and new...just look at the GFC>

    The Securitisation market is very sensitive right now specially from Japaneses investors given the 0% rate ...
     
    Mick C, 27th Jul, 2015
    #18
  19. kr11

    kr11 Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    98
    Location:
    sydney
    so does that mean nab is targeting all i/o loans regardless of ppor or i/o whereas cba and anz are not touching i/o ppor loans?

    thanks
     
    kr11, 27th Jul, 2015
    #19
  20. Mick C

    Mick C Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    206
    Location:
    Sydney
    Correct
     
    Mick C, 27th Jul, 2015
    #20
Page 1 of 3