GE Money Early Exit Fee Waived
GE Money borrowers will be able to exit their loans without being charged an early exit fee if their loan is less than 5 years has elapsed after the loan was settled. This is also know as the Deferred Administration Fee (DAF) .
News came out today that GE Money will not be passing on the recent 1% rate cut claiming the high cost of funds on the wholesale markets. That’s funny to hear because many other non bank lenders are not feeling the same pinch as GE Money. I believe they want their customers to refinance and refinance quickly by making them pay at least 2% higher than any other bank.
There is one condition to their offer, it is only available for a three month period from March 1, 2009 to May 31, 2009.
If you are looking to refinance from GE Money to a reputable lender please contact us as soon as possible.
You can do one of the following
Call 1300 726 136 and a professional mortgage consultant will find you reputable lender
Complete an online quote form or
Interest Rate and Lenders Rates Update
Filed under: Home Loans, Interest Rates, Investment Loans
As we know that the Reserve Bank of Australia cut interest rates by 1%. Analysts are predicting further rate cuts in March and after Easter. How much the RBA will reduce rates will depend largely on global and local economic factors.
Most lenders this time round passed on the full rate cut. Whether they continue to do so is “under constant review” as stated by many of the major banks.
Updated below are the better home and investment loans for February showing interest rates from lenders with the most competitive offerings. Please note that home loan rates have very similar pricing to investment loan rates.
St George Professional Package – 4.39% first year then 5.19%, Comparison Rate = 5.33%
NAB – 1 Year Discounted Variable – 4.65% first year then 5.74%, Comparison Rate = 5.71%
RAMS Home Loans – Rate Relief – 4.69% first 2 years then 5.29%, Comparison Rate = 5.22%
Bank West Rate Tracker – 4.92% first 3 years then 5.68%, Comparison Rate = 5.53%
Heritage Building Society Basic Loan – 5.07% – Comparison Rate = 5.09%
RAMS Home Loans – 5.09% – Comparison Rate = 5.12%
St George Basic Home Loan – 5.17% – Comparison Rate = 5.20%
Professional Packaged Home Loans (Recommended for $250K plus borrowers)
Commonwealth Bank Wealth Package – 5.04% – Comparison Rate = 5.22%
ING Home Loans – Smart Pack – 5.13% – Comparison Rate = 5.15%
Westpac Home Loans – Premier Advantage – 5.21% – Comparison Rate = 5.41%
Commonwealth Bank Low Doc – 5.04% – Comparison Rate = 5.22%
ANZ Home Loans - Simplicity Plus – 5.21% – Comparison Rate = 5.23
Westpac Home Loans – Premier Advantage – 5.21% – Comparison Rate = 5.41%
Commonwealth Bank - 5.09% – Comparison Rate = 5.22%
Suncorp Line of Credit – 5.20% – Comparison Rate = 5.35%
NAB Home Equity – 5.22% – Comparison Rate = 5.33%
St George 3 Year Fixed – 5.49% – Comparison Rate = 5.47%
Westpac 3 Year Fixed Rate – 5.49% – Comparison Rate = 5.49%
NAB 3 Year Intro Fixed Rate – 5.49% – Comparison Rate = 5.86%
RAMS 5 Year Fixed – 6.29% – Comparison Rate = 5.91%
Need Help
The loans mentioned above may not be suitable for your lending needs. Please contact us of submit an online enquiry.
Important Notes
The interest rates mentioned are only available on the date published and are subject to change.
Comparison rates are based on a $250,000 loan for 25 years. This Comparison Rate applies only to the example or examples given. Different amounts and terms will result in different Comparison Rates. Costs such as redraw fees or early repayment fees, and costs savings such as fee waivers, are not included in the Comparison Rate but may influence the cost of the loan.
Fixed Rate Mortgage Exit Fees
Many borrowers may find that it very difficult to get away from their fixed rate loans as the costs may be too expensive.
As we are seeing significant decreases in mortgage rates over the last 6 months many mortgagors with fixed rate loans are contemplating switching to a variable rate mortgage.
So what are the costs involved?
The main cost is known as “break costs”. This is the cost of breaking your fixed mortgage early.
The actual cost of breaking a fixed rate mortgage varies significantly. The calculation of the actual cost depends on the following factors;
1.The interest rate it was fixed at compared to the current wholesale lending rate
2. The term remaining on the fixed rate contract
3. The amount borrowed
For example, if a person has a $300,000 home loan, fixed it for 3 years at 8.00% and has 2 years remaining he could be up for significant break costs. If the wholesale mortgage rate for bank XYZ was 4.00% the break costs would be around $24,000
Calculated as: $300,000 times 4% (the difference between the wholesale rate and the fixed contact rate) times 2 years (the number of years remaining) = $24,000
Basically, you are paying the whole interest rate differential up front to the lender. Unless you feel the interest rate is going to be significantly less than the wholesale rate in the future then breaking a fixed rate contract may be worth considering. Always contact your lender and find out the exact exit costs as each lender has different calculations for breaking a fixed rate contract early.
As you can see that breaking a fixed rate loan when interest rates have decreased can be very expensive. The opposite is true when fixed rates rise and in some cases a borrower may receive a cash refund from the lender.
If you would like help with breaking a fixed rate loan please contact us or leave a comment below
RBA Cuts Interest By 1% – Will The Banks Follow?
Today the Reserve Bank of Australia cut interest rates to 3.25%. They claimed that the deteriorating world economic conditons is the major reason for the 1% reduction in the cash rate. To read the full report click here.
It will be interesting to see if the banks pass on the full interest rate cut. Politicians can huff and puff about major lenders passing on the full savings but it will be entirely up to the CEOs to make that decision.
I will keep you updated over the next week or so on the latest offerings from Australia’s major lenders and how much of the latest rate reduction they will pass on to consumers.
Westpac and ANZ have passed on the full 1.00%
Early this morning (4th Feb) NAB and Commonwealth Bank have also reduced their rates by 1% passed on to customers on the 13th February
I expect other second tier banks and lenders to follow suit. I will keep you updated.
ING have passed on 1%
RAMS will pass on 1% by the 9th
Suncorp have also passed on the full 1% but customers will have to wait until the 23rd
Bank West have also passed on the full 1%
It looks like all lenders have passed on the full 1% rate cut. However, news reports have intimated that all the big four banks are constantly reviewing their interest rate policy. This might mean that they might not pass on the full rate cut at future RBA meetings. We can only wait and see…
Keep an eye out in the next week or so to see how these lenders compare with their product offerings.