Everyone to their own Go but hope you understand the true costs with the Rate Tracker loan.
Forget the advertised interest rate of 4.92% as the CAR rate is comparison rate of 5.61% and not cheap.
Secondly might want to check the PMI LMI rate as at 95% it is more expensive than most.
If you take the 100% offset account which costs $15 / month you would certainly need a fair amount in the account to even break even each month.
Interest only available in certain circumstances.Also leave yourself plenty of time for settlement as they have to be the worst lender i have ever come across when it comes to documentation and settlement.
Richard Taylor | Australia's leading private lender
Richard, I guess that GOB has been swayed by stupid advertisements or by the 'non-competent' mortgage broker.
Hi Richard,
Thanks for the notation. I think that while the comparison rate is higher after 36 months I'm hoping to move on by then (a pretty good incentive!!) and LMI at ~$4600 is something I'm happy to pay. It fares higher than some and lower than others in my comparisons and is not overwhelmingly significant in comparison to similar products I've viewed.
The Offset is something which will help me if I plan diligently and I'm hoping will make a difference. Without calculations on me it'll break even at only several thousand sitting there offsetting the $15 fee.
Fingers crossed I have a speedy paper trail conducted…less than 48 hours for pre-approval so happy there so far
Gobsospace
GOM
You are so right.
Unfortunately for GOB the CAR rate is from day 1 and unless he is in Qld the LMI is a higher than $4600. (Qld has the lowest Stamp Duty on LMI premiums) when other lenders are $400-$500 cheaper.
With $3000 sitting in the savings account every single day for a year he will be actually loosing $3 a month when the Bank charge him $15 / month and that assumes we see no further reduction in interest rates for the next 12 months.
Assuming there is moderate capital growth in the property over the next few years before he breaks the contract he might still be up for LMI again and if there is no CG then to refinance a 95% lvr is not easy. (Well let us just say your options are lmited).
Guess you cant some people that are so blinded by the lowest interest rate they forget to look at the other features.
Richard Taylor | Australia's leading private lender
Thanks for the response
I am tossing up whether to go P + I whilst I live in the property, then going Interest only. Or possibly Interest only from the start. Interested in knowing opions of each direction
Poto
Some lenders charge a higher mortgage insurance premium if you go IO from the start so another reason why your mortgage broker should have a good knowledge of structures as well as merely lenders loan products.
Richard Taylor | Australia's leading private lender
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