Join Australia's most dynamic and respected property investment community

Westpac Increases rates for investors

Discussion in 'Property Finance' started by Terry_w, 31st Jul, 2015.

  1. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

    Joined:
    18th Jun, 2015
    Posts:
    8,943
    Location:
    Sydney
    wategos likes this.
  2. spludgey

    spludgey Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    679
    Location:
    Sydney
    St George 0.25% according to the article. Not overly happy about it, but not as bad as it could have been either!
     
  3. Mick C

    Mick C Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    206
    Location:
    Sydney
    Confirmed.

    Westpac will increase rate for existing investment loan by 0.27% as of 25/9/2015 ( LOl at the delay ....i guess their IT pplgot a deadline to meet...)

    For new investment loan it will increase by 0.27% as of 10/8/2015

    Also Westpac has made a few policy changes, making them a lot hardier to service and hardier to take out equity...
     
  4. WattleIdo

    WattleIdo renovating Premium Member

    Joined:
    18th Jun, 2015
    Posts:
    1,809
    Location:
    Central West NSW
    Harder or hardier? If hardier like a Tonka truck, that sounds good.
     
  5. Blacky

    Blacky Well-Known Member

    Joined:
    25th Jun, 2015
    Posts:
    1,103
    Location:
    Bali
    Bugger - they were my next preference.
     
  6. HUGH72

    HUGH72 Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    2,117
    Location:
    FNQ
    I've got a few IO loans with them and the 5 year IO period is due for renewal next year. I'm wondering whether their tick and flick IO renewal process is still going to apply or whether they will look to move more of their business to P and I loans?
     
  7. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

    Joined:
    18th Jun, 2015
    Posts:
    8,943
    Location:
    Sydney
     
  8. tonyc00

    tonyc00 Member

    Joined:
    12th Jul, 2015
    Posts:
    6
    Location:
    sydney
    Hi

    Can someone explain to me the logic behind the delayed timing of teh rate increases.

    Existing investment property customers will have their variable interest loans increased from 25/9/2015 - are Westpac hoping that existing customers will switch to fixed interest before 25/9/2015.

    And the interest rate for new investment property loans (not "new" customers) will increase from 10/8/2015 - are Westpac saying load-up now because rates for new loans are about to increase.

    Thus as someone with several IP's with Westpac, and looking for more, my best option would seem to be switch to fixed interest for existing loans, and jumpin now for any new loans.

    Where is the benefit to Westpac by the delayed implementation.

    Tony
     
  9. acorn123

    acorn123 Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    100
    Location:
    NSW
    It was mentioned somewhere in this forum: Westpac is having a technical problem (computer?) and unable to implement these changes in time. It seems that other banks just pressed a button for implementing this rate hike. It is in the news too.
     
  10. mja

    mja Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    175
    Location:
    Sydney
    Westpac couldn't differentiate between PPOR and investment lending. Software problem.
     
  11. euro73

    euro73 Well-Known Member Business Member

    Joined:
    18th Jun, 2015
    Posts:
    1,412
    Location:
    Sydney
    This is a tough question.... especially because Westpac seem to be taking an incremental approach to their tightening. I suspect you'll be an easy target for them, though - remember unlike AMP, who needed to get under the 10% APRA threshold by Dec 31 this year, Westpac and other lenders have until June 30 2016 to do so - hence the incremental approach rather than boots and all approach of AMP.

    Given how far over the 10% threshold Westpac is.... making it hard for I/O terms to be renewed seems like low hanging fruit to me . You should seriously consider refinancing to a lender where you can secure another 5 or 10 years I/O, while you are able to- just as a contingency. Otherwise, consider the possibility of being P & I next year, in an environment where no one is readily open to taking on I/O refinances.
     
    HUGH72 likes this.
  12. jaybean

    jaybean Well-Known Member

    Joined:
    20th Jun, 2015
    Posts:
    981
    Location:
    Melbourne
    I agree get it done asap. I have one due in 12 months but I'm not waiting. Be too greedy and you'll get burned.
     
    HUGH72 likes this.
  13. HUGH72

    HUGH72 Well-Known Member

    Joined:
    18th Jun, 2015
    Posts:
    2,117
    Location:
    FNQ
    Thanks for your thoughts @euro73.
    I was a long way from any serviceability wall but it appears to have been moved a little closer. I will look at obtaining some more funding sooner rather than later though.
     
  14. starlight

    starlight Member

    Joined:
    20th Jun, 2015
    Posts:
    12
    Location:
    Perth
    Hi Guys,

    In lieu of the rates hike by Westpac, has anyone decided to switch to fixed interest on your loans? If so, what rates are Westpac offering at the moment and for what loan amount?
     
  15. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

    Joined:
    18th Jun, 2015
    Posts:
    8,943
    Location:
    Sydney
    Many have panicked and fixed. But in my opinion it doesn't necessarily follow that it is a good time to fix.
     
    chylld likes this.
  16. Timkot

    Timkot Member

    Joined:
    28th Jul, 2015
    Posts:
    7
    Location:
    gladstone
    In other big end of town games like petrol price the overlords like ACCC are always looking for collusion. Can anyone tell me how this move on investors of roughly a quarter per cent is not a classic example of collusion. There may b e a reasonable reason but I am just asking
     
  17. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

    Joined:
    18th Jun, 2015
    Posts:
    8,943
    Location:
    Sydney
    Yes, this is really collusion. But it could be argued that the first bank established the increase amount and the rest are just following the market now.
     
  18. Redwood

    Redwood Well-Known Member

    Joined:
    22nd Jun, 2015
    Posts:
    342
    Location:
    Melbourne
    Its interesting hey - one bank comes out and the rest follow - what is the real cost to the banks? as an alternative - I am using non bank lenders - no ********, real service and lower rates...why not?

    These increases are nothing more than a disgrace.


    Cheers Ivan
     
  19. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

    Joined:
    14th Jun, 2015
    Posts:
    1,158
    Location:
    Gold Coast
    There are lots of options.

    As to what volume options there really are, im not so sure middle term.

    The vast majority ( by volume of funding) of "non bank" lenders are funded by banks, and I fully expect the last remaining BS and CU will also go for the grab ( assuming there is one), because after all, Investors a soft mark and can afford it.........

    ta
    rolf