NAB Equity Builder - too good to be true?

Download the forms here https://www.nabmarginlending.com.au..._app-kit/NAB_Equity_Builder_How _To_Guide.pdf, fill out the request facility and send it to the nab lending email address.

I submitted the form last Sunday, they came back on Monday requesting me to confirm my living expenses and approved the facility on Tuesday.

The average facility size is 250k (<-- hint)

 

What do you mean by this? I applied by sending through the forms directly back in August but still haven't heard back. I opted for the minimum facility size as I just wanted to have a play and see how it works before deciding if and when I should increase it. Do you think my slow response is due to the small facility size?

 

That's awesome. Congrats. Thank you for the HINT !!

I have a setup a trust for share trading. Should I apply for NAB Equity Builder using trust or use personal name to keep it simple for them (and improve chances of acceptance) ?

 

Don't know mate, but cost vs profit, simple math especially for banks.

 

What suits you best.

 

Meaning, individual or trust - doesn’t matter to NAB?

 

Looks like there is establishment fees for trust.

 

Do we really need to provide details of existing investments to be held as loan security? Looks like they will get control of any existing investments provided as security. My existing investments are mainly is US market using stake.



From PDS

Ownership and control of investments NAB Equity Builder uses NMS Nominees P/L (Nominees) to purchase investments on your behalf. Nominees will be registered as the legal owner of (1) all new investments acquired with the borrowed funds, and (2) any existing approved investments provided as loan security by you (the borrower).

However, so long as you owe money under a loan, you will not be able to give Nominees instructions or directions in respect of the investment securing that loan without NAB’s consent.

 

The pdf you have shared has multiple forms.

I am filling in the Loan request form (below) but it does not ask for any details like identity documents (DL etc), TFN, personal income, assets/liability. Am I missing something?

https://www.nabmarginlending.com.au...-kit/NAB_Equity_Builder_Form_Loan_Request.pdf

 

Its like old system title property mortgages. They will be the legal owner of the shares while any debt is secured by them.

 

Please have a look at page 10 on this link, it has TFN...

https://www.nab.com.au/content/dam/...tment/nab-equity-builder-application-form.pdf

 

Isn't that for advisors?

 

Not sure, had another look when we applied it was 14 page doc this one is 20 pages but looks very similar.

I think best to call them on 1300135145 and ask...

 

If you apply for 250k you get further 25 BPS discount.

 

That’s great to know and thanks for sharing. But which form do we use for new application ? I called up and they said new applications are closed.

 

Pls go back to my previous post and re-read.

 

How did you secure that? Was it just automatically offered?

 

Looks like westpac offers a similar product, pre-paid rate 3.7%

Westpac Online Investment Loan

 

I think you'll find it's not a similar product, it's a pure margin loan with full margin calls.
Read the Loan Facility Agreement


8.4 A margin call must be satisfied by taking the action referred to in clause 8.5 by 2pm (Sydney time) on the next business day after the day the notice is issued by us, or such later date as we may advise.
8.5 The action you must take if your loan account goes into margin call is to:
(a) repay some or all of the amount outstanding; and/or
(b) provide us with additional security interests which are acceptable to us; and/or
(c) arrange to, or give us irrevocable instructions to, sell, dispose of or redeem some or all of the mortgaged property (with the proceeds being used to reduce the amount outstanding or being deposited to the credit of a cash management account); and/or
(d) take any other reasonable steps we consider necessary, so that the loan balance no longer exceeds the borrowing limit.

NAB equity builder and the like have the 'protection' of either no margin call, or a grace period/instalment plan to pay it off. Which is the massive attraction of such products for the unsophisticated investor.

 

For Pure Margin Loan, IBKR offers best rates

https://www.interactivebrokers.com.au/en/index.php?f=46782&p=m