Westpac loan discount good?

Discussion in 'Loans & Mortgage Brokers' started by Simon Arabian, 24th Feb, 2020.

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  1. Simon Arabian

    Simon Arabian New Member

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    Hi All

    I was taking stock of offers this weekend and discovered some rather attractive offers being offered by some of the other big 4 banks. To add insult to injury, Westpac (my current loan provider) is offering a new loan product for IP called "Flex First Option Investment Loan" which is 3.49% (<70% LVR) and 3.59% (>70% LVR). My current discount on the Rocket Investment Loan is 1.50% which brings it to 3.88%.

    I sounded my concerns to the mortgage officer at my local branch via email, and noted some other attractive offers in the market. Without hesitation, I got a response within the hour increasing my discount to 1.74% which would bring my P&I IP loan to 3.64% p.a.

    Is this a good deal or is it common to get a higher discount / be asked to match offer for new customers? Thought I'd note we're talking about a loan size of ~$2m which is currently at around 60% LVR.

    Appreciate your thoughts
     
  2. Peter_Tersteeg

    Peter_Tersteeg Well-Known Member Business Member

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    Something's note quite right in the figures quoted. The P&I Rocket investment loan SVR is 5.28%, so with a 1.74% discount the delivery rate should be 3.54%.

    There are a number of second tier lenders currently offering what's essentially the same product with rates of 3.39%, a couple even go quite a bit lower.
     
  3. Shahin_Afarin

    Shahin_Afarin Residential and Commercial Broker Business Member

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    Westpac's pricing is very sharp - we are seeing circa 2.86% - 2.94% for owner occupied P&I under 70% LVR and 3.19%-3.23% for investment P&I in the $2mil loan amount range.

    Plus they are doing the $3k cash back per property until the end of Feb although St George have just come out with $4k cash back but Westpac has the superior interest rates.
     
    Cia and oracle like this.
  4. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    If rate is the only driver, then there many lower REAL cost options out there

    ta
    rolf
     
  5. Simon Arabian

    Simon Arabian New Member

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    Thanks for your replies
    The Westpac site has it as 5.38% here: Home loan interest rates tables

    The loan is pretty much 50/50 between two properties. The one property is a large townhouse with a commercial unit attached on the ground floor and Westpac was the only bank at the time willing to treat it as a residential mortgage at 60% LVR max. Even though the commercial aspect is ~20% of the total property, no other lenders were willing to touch it and were referring me to their business lending arm. In the past, the main deterrent has been when a bank has ordered a standard valuation only for them to come back a say a non-standard valuation is required because of the commercial unit.

    The unit is currently sitting empty and I'm considering converting it into a 2 bed self-contained resi flat (like a granny flat) with the hopes that it would open the door to more lenders, and would pass for a standard valuation.

    Conscious there are better rates in the market and I'm also aware of the limitations given my situation. I have a couple more questions:
    - Is the 1.74% discount good or can I get higher with westpac?
    - How is their new product offering (Flexi First Option Investment Loan) any different to the Rocket Investment Loan? Is it only a honeymoon rate (even though site specifies a different SVR and discount is for life)? Can they just not offer me this product?

    Many thanks again - really grateful for your input
     
  6. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    Flexi loan dunna have an offset

    ta
    rolf
     
  7. Cia

    Cia Well-Known Member

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    I recently financed my loans to Westpac got $2k cash back. Rates as you state Shahin 2.94% for OO PI and 3.19% for Investment PI. all 80% LVR. I'm v pleased as I have full offset account facilities for both. Previously was on almost 6% II on Investment with Pepper due to original 92% LVR to purchase. Luckily the II grew in value over the past 2 years.
     
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  8. Omnidragon

    Omnidragon Well-Known Member

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    I have some loans with them (resi). And it's like 3.45% IO investment.

    I've got commercial with ANZ sub 3% IO.
     
  9. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    Bank bill backed though perhaps

    different animal

    ta
    rolf