Who has the best rate? … An updated look.
Such a simple question – yet it doesn’t have a simple answer.
1. Lenders used to price your loan based only on loan size – the bigger your loan the lower your rate.
2. Now … the bigger the loan size AND the bigger your deposit the lower your rate – a double reward system if you like.
3. And a third factor – is it an owner occupied loan or an investment loan?
4. And a fourth factor – is it a Principle & Interest (P&I) or Interest Only (I/O)?
If you have a large loan and a small deposit - we would look at very different lenders than if you have a big loan and a big deposit.
If you are buying an investment property we would need to find a lender who rewards you with a good rate.
Fees also play a big part and here’s the idea : Rate is proportional and has the most effect on bigger loans.
Fees are constant and have the biggest relative effect on smaller loans.
On smaller loans it is usually cheapest to find a lender with no fees and a reasonable rate rather than a lender with a lower rate but higher fees.
And to add another layer … we need to find a lender who will agree to work constructively with me to ensure your rate remains the same or very close to the best rate they are offering to new customers from time to time
Who has the best rate? – is more complicated than most people realize – that’s why it makes sense to Ask Alan.
I will find the best loan for your specific and personal circumstances.
Call or email me anytime... it's what I'm here for...
Alan Heath