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CITIBANK Personal Loan from 3.9% Upto $60k for 3 Years

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CITIBANK Personal Loan from 3.9% Upto $60k for 3 Years
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annexe on 08/12/2014 - 10:53 citibank.com.au (4054 clicks)

Hi all,

I'm sure this is not for everyone but found interesting one.
Personal loan rate that rewards you for a great VedaScore band – from as low as 3.9% p.a. for 3 years.

So this is how it works:
If you're on Excellent rating: 3.9%
Good rating: 4.9%

  • Access cash or transfer a balance of up to 80% of your credit limit at the promotional rate
  • $129 establishment fee
  • No monthly or annual fees
  • No early payout fees, if you want to accelerate payments
  • A standard variable rate of 19.49% p.a. applies to balances outside of the promotional offer

Fine Prints:
Important Information.
Fees and charges apply. Terms and conditions apply and are available upon request. Credit criteria apply. Existing Ready Credit, Personal Credit and Business Credit customers are not eligible to apply for this introductory offer.
Based on your Veda Risk Band, you will be provisionally offered a promotional interest rate. Access to this promotional rate is subject to Citibank's assessment of your application according to its standard credit criteria. The promotional interest rate from Citibank applies to balances transferred with this offer at point of application and cheques-to-self with this offer within 90 days of account opening. Payments are applied to BT amounts before cash advances and retail purchases, and if your account has more than one BT, the BT at the lowest interest rate will be repaid first.
A credit line of between $5,000 and $60,000 will be assigned based on our credit criteria and your credit rating. You can borrow funds from Citibank at the promotional interest rate by a BPAY balance transfer, or by a cheque. If you choose to receive funds using a cheque, this will be treated as a balance transfer (BT) for the purposes of your terms and conditions and statements. You can borrow up to 80% of your credit limit. Minimum income required is $35,000 a year.
The Establishment Fee will be debited to your Citibank Account on the date we issue you a statement of Account for the Statement Period in which you first use or activate your Account.
Other service fees and charges including late payment fee and dishonor fee may apply.
At the end of the promotional period, the interest rate will revert to the Citibank Ready Credit standard Annual Percentage Rate, currently 19.49% p.a. Interest rates are variable and subject to change.

Financial Loan Veda

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closed Comments

  • affable on 08/12/2014 - 11:02
    +14

    Thinking outside the box, $60k @ 3.9%, reinvest in Ubank at 4.02% = 0.12% for 3 years, less $129 fee. $87 arbitrage (before tax) from $0 investment! However the Ubank rate is dropping all the time so you could get burned. Not worth it.

    • dasher86 on 08/12/2014 - 11:04
      +21

      plug it into your home loan then redraw once the period is up.

      • jollster101 on 08/12/2014 - 11:22
        +1

        If the 3.9% could be guaranteed then that could be worth it, the 4.9% not so sure as my home loan rate is less than that currently.

        Wonder what it turns out to be in savings on a 450k loan.

      • AsSeenOnTv on 08/12/2014 - 11:55
        +2

        I already did this a few months ago when it was 2.9% for 2 years.

        @affable - There is no risk with Ubank dropping their rates as you can simply redraw and pay back the personal loan at that time.

        • UFO on 08/12/2014 - 16:22
          -1

          nope, its a fixed personal loan with specified amount of payments.

          paying it off early as suggested wont get you out of the interest you would owe over those 3 years.

        • AsSeenOnTv on 09/12/2014 - 10:07
          -1

          @UFO: There may be minumum payments but no it says clearly on the front page there are no early payout fees, and it is a line of credit so you only pay interest on any amount outstanding.

        • UFO on 11/12/2014 - 11:08
          +2

          @asseenontv:

          Ok.

          I originally replied to your comment because you gave incorrect advice relating to early payment of loan. Its dead set plain wrong.

          I have this product, and I'm telling you right now… you are getting confused with what is on offer, and how it works.

          The 3yr personal loan available as OP as posted, utilises your existing line of credit facility as the credit process (like a preapproved credit limit), but this is MOST DEFINITELY a fixed personal loan that operates separately to the facility already pre-approved, with its own interest rate.

          The loan comes under the umbrella limit of your line of credit facility, and the fixed payments are based on the above reduced percentage rate.

          You miss ONE payment or otherwise breach the repayment terms, they will 'transfer' the personal loan into your line of credit facility, where you will pay almost 20% on whatever is owing… and not the 3.9% on offer.

          You obviously arent grasping what I'm trying to explain here, so I'll try again (if not for you, for others reading).

          There IS a penalty in missing payments (the balance owed transfers to your line of credit facility which is considerably more expensive than the promotional fixed payment personal loan), and there is NO WAY of avoiding interest by paying it off early (because it IS a fixed payment personal loan).

          There are no early payout fees, but in order to pay it off early you will have to pay the remaining payments that are left (which incorporate interest over the entire initial period of the loan… as ANY fixed payment personal loan does). There is nothing different to this personal loan over any other, other than if you miss a payment they wont chase you for it… they'll simply cancel the entire loan and move it over to your credit facility, potentially costing you thousands in interest.

          I'll take your unfair neg and also give you one back in return, because the advice you gave was wrong. Re-read the terms and conditions.

          This is a great product if you use it right. If you dont, it could end up costing you a lot of money.

        • AsSeenOnTv on 16/12/2014 - 17:21

          @UFO: No arguments on the missed or late payments, but that was never even alluded to before your latest post. The disputed point is whether you pay interest on the outstanding balance, or on the total amount even if it has already been paid back.

          Essentially what you are saying is that if you get a cheque for $50k then pay the $50k back the next day you will still be liable for interest on the full $50k for the full three years (correct me if I have misunderstood what you are saying).

          I am saying that you only have to pay interest on whatever the outstanding balance is not the full amount.

          Happy to be corrected, but at least back it up with a specific reference to the actual terms and conditions because what you are saying doesn't seem consistent with the limited T&Cs on the website.

          I neg'd because i think your advice is wrong, but i'll hold off on any more until you respond.

      • YellowKnight on 08/12/2014 - 12:15

        Would this work? There must be a loophole. Free bank money is a myth.

        • mranderson978 on 08/12/2014 - 13:54
          +1

          It works so long as you meet the criteria and get approval and your home loan is more expensive than the personal loan rate.
          I did the math for my home loan which is 4.95%
          Assuming they're happy to give me 3.9%, with the establishment fee, it'd be $590 over 3 years.

          What you have to do is work out whether it's worth your while to fill out all the paperwork and make regular repayments for 3 years, for the sake of a bit under $600.

          For me, it's too much effort.

    • Tarinedier on 08/12/2014 - 11:27
      +2

      You still have to make monthly repayments though don't you? If so a term deposit would be out of the question as you would need to continuously draw money out to make the repayments.

      • jaybmate on 08/12/2014 - 14:14

        term deposits arent even worth doing these days anyway. Ubank has better rate and no real restrictions.

    • SteveBuscemi on 08/12/2014 - 11:39

      $48k @ 3.9% is the max.

      $60k would be at 19.49%.

      • mr_fjackson on 08/12/2014 - 14:12

        I don't think so, it's 80% of your credit rating. So if they say they will loan you 50k 80% of that.
        But then if they loan you 200k only the first 60k would be at 3.9% I think.

    • Shadowsfury on 08/12/2014 - 14:36
      +1

      You're forgetting tax…

      You're paying 3.9% from your after tax income, earning 4.02% BEFORE tax, which for the vast majority of people would drop it way below 3.9% once tax is taken into account.

      EDIT: Putting it into your home loan is another matter though, assuming its a PPOR mortgage (where you're saving on the payment of after tax interest)

      • kenm on 08/12/2014 - 16:23

        You can deduct the cost of borrowing from investment return. So, in your example, tax only payable on the 0.12% margin.

    • diddy50 on 17/12/2014 - 13:15

      With this deal, does it mean after 3 years the rate goes up to 19.49%
      Say I wanted to get use this for a car loan.

      three years great rate, from then on bad rate?

  • chillwok on 08/12/2014 - 11:14
    +7

    i was skeptical about Citibanks similar deal when this loan was at 2.9%. i went through with it and it's been great so far. one thing to note, if you want a certain amount then put it down on the application. i listen to the guy in india and left it blank as he said you can nominate a figure when you get approved. once u get approved it's too late as they give you a random figure based on what your wage and expenses you put down on your application. this is still a great deal considering all other personal loans are at a higher rate. one last thing, banks usually charge you for a cheque, but the cheque to self is free and done over the phone and sent out via snail mail.

    • salem on 08/12/2014 - 11:35
      +7

      Won't help. I wrote down a specific amount on my application, was told I was successful, bought a car, when the snail mail came through with the documents it turned out I was successful for an amount that was less than what I applied for, but they never told me that in the email or the phone calls. Luckily I'd over applied intentionally and I still got enough. But it was dodgy.

      • rdhupar on 08/12/2014 - 11:41

        I had the same and got bitten. Luckily, for me I had enough reserves to cover but very dodgy.

      • Smigit on 08/12/2014 - 11:44
        +5

        One thing to keep in mind is the actual cash/balance transfer they give you will be 80% of whatever you apply for. The other 20% is available on a credit card you will also be issued. So if you need 8K, apply for 10K.

        Also any repayments of the account go towards paying the balance transfer first, then credit card repayments. It's only the balance transfer that'll be on 3.9% interest, anything on the credit card is around 19% from memory so if you have a huge balance transfer and then put anything on the credit card, you have to pay back that balance transfer before eating into the credit card repayments that are racking interest at about 19%.

        We got this account for a car loan and had no issues. Just cut the credit card up when it arrives since youre better off having the card on a separate account where you can control exactly when the repayments will be made. Other than that, it took us about three weeks to get the account set up initially so it may pay to take the loan out before you need the money, say if you are shopping for a car. Certainly it was no where near as quick as going through a car dealers financer.

        • damoo on 08/12/2014 - 13:16
          +1

          This used to be the case- but the laws were changed a couple of years ago and now the highest interest gets paid off first.

        • Smigit on 08/12/2014 - 13:20

          @damoo:
          I'd want to double check that because it contradicts the terms above which state repayments happen on the balance transfer first and other purchases second:

          The promotional interest rate from Citibank applies to balances transferred with this offer at point of application and cheques-to-self with this offer within 90 days of account opening. Payments are applied to BT amounts before cash advances and retail purchases, and if your account has more than one BT, the BT at the lowest interest rate will be repaid first

          I wouldn't take the risk myself. The credit card isn't anything special anyway so you're probably still better off shopping around.

        • damoo on 08/12/2014 - 16:45

          http://www.bankingreforms.gov.au/content/content.aspx?doc=fu…

          "From 1 July 2012 changes to NEW credit card contracts mean:
          Credit card providers will be required to direct repayments to the most expensive part of your credit card debt first - making it easier to reduce your debt faster."

        • mjs on 08/12/2014 - 17:01

          @damoo: This is a "ReadyCredit" facility not a "credit card" - so the new laws don't apply to this product (even though it behaves like a credit card).

      • chillwok on 08/12/2014 - 12:32
        +1

        i guess my point here was for everyone to over apply as i didn't get the chance too :(

  • G5 on 08/12/2014 - 11:18

    Where is the information about the rate you get for different bands?

    • annexe on 08/12/2014 - 11:28

      They don't actually have the rates on different bands.
      But if you go through the VEDA credit check link on the site, it will show your band and the offered rate.
      Great now you know my rating lol

  • SteveBuscemi on 08/12/2014 - 11:19
    +2

    You can only borrow 80% of your credit line at the low rate, so even if they give you 60k you can only use 48k.

    I applied last time when it was up a 2.9%:
    https://www.ozbargain.com.au/node/151314

    YMMV, but on the end I just didn't bother activating it because they didn't offer me anywhere near 60k and its not worth having a 5-figure loan to make maybe a hundred bucks of profit when all is said and done. At 3.9k? Wouldn't even bother applying.

  • Sharp on 08/12/2014 - 11:45
    +2

    Got 30k from the previous deal (2.9%) and put $24k in my offset account (%4.49). I've been paying the minimum payments to Citibank (less tan $300 per month) to maximise my return. After the 23rd month I'll transfer the owing back to citibank and close the account.

    I think it's worthwhile the hassle at 2.9% but I wouldn't do it at 3.9%.

    • SBOB on 08/12/2014 - 12:05

      whats that equate to at 2.9%.. ~$360 bucks pre tax? (using some quick crappy maths and not accounting for any accumulative interest/repayments)

      • Sharp on 08/12/2014 - 13:43

        no tax cos it's an offset account.

        I have a running spreadsheet but roughly in average making 45 bucks per month for 2 years. So $1080 total over two years. (Paying around $55/pm interest to Citi and making $100/pm from offset account).

        p.s. correction. My homeloan rate is 4.93% not 4.49%.

        • SBOB on 08/12/2014 - 16:12

          I have a running spreadsheet but roughly in average making 45 bucks per month for 2 years. So $1080 total over two years. (Paying around $55/pm interest to Citi and making $100/pm from offset account).

          $24k at 2% pa (4.9%-2.9%=2% pa difference) for 2 years (disregarding any payments you need to make back on the citi loan) = $960
          Even with compounding I'm struggling to see your $1080 (and you need to reduce payments while adding any compounding interest)

          Im doing a similar thing using their platinum credit card (and an ANZ one) to offset ~40K on my homeloan, so not arguing with the process…

    • bigrizz on 08/12/2014 - 22:43

      Yep, I was thinking exactly the same thing. In your case, you've essentially fixed $24K of your loan at 2.9%. Seems like a good deal to me. If I can get $48K fixed at 3.9% for 3 years, I'm in.

      The only problem I have is that in trying to apply for the loan, I can't be verified with a VedaScore, which is strange given I've had credit before and have had credit cards for over 20 years. Hard to believe that I wouldn't have a credit rating.

  • Cluster on 08/12/2014 - 11:51
    +1

    A friend was paying 18% (yes really!) on his personal loan. A month ago I found out and dug up Citibank's 3 year @ 4.9% deal and got him to switch. He's saving over a thousand dollars a year in interest.

    The process of applying for and drawing on the loan was apparently pretty easy. The only catch: you get a debit card linked to the loan as well. Whatever you do, DON'T use it. Draw the maximum 80% from the loan and literally put the debit card on ice. For some people it's too tempting to draw more from the loan and get hit with 19.5% interest.

    • konazz on 08/12/2014 - 12:01

      When we got our interest free card… we literally cut it up and threw it out. We needed to buy something on it recently, and we just took the most recent statement in and they used that to process the payment. No temptation to spend $$$

    • Smigit on 08/12/2014 - 12:04
      +1

      Absolutely. If you want a credit card apply for that separately, either with Citibank or any other bank. The fact repayments must go towards the loan first is a really big potential trap if you skim over that detail. Certainly you don't want several thousands of dollars sitting between you and the repayment of a purchase that is incurring interest at 19.5%.

  • brucebruce on 08/12/2014 - 11:58

    Very hard to get approval. We have been rejected and our household income is not that low (comfortably in the 6 figure range) with more than $XXXk in asset.

    • montorola on 08/12/2014 - 12:50
      +10

      That's why they didn't approve lol cause you don't look like someone they could make money off

  • burningrage on 08/12/2014 - 12:03

    I got a band that makes me wanting to pay for VEDA actual score…

  • konazz on 08/12/2014 - 12:14

    Anyone know how to actually get your score? I'm looking at my Veda credit file (I ordered all of them a few weeks ago) but can't tell what the score is.

  • YellowKnight on 08/12/2014 - 12:17
    +1

    Can someone explain to what everyone is going on about when they say dump it into an offset account.

    How much would you save on interest on say a $200k home loan in 3 years?

    There must be some catch I'm missing.

    • escusemay on 08/12/2014 - 13:09
      +3

      Assuming 5% interest rate and you're paying interest only:

      5% of $200K is $10,000 per year ($833.33/month in repayments).

      Now say you get approved for $50K, dump that in your offset account and interest will be calculated at $150K (since you deposited $50K).

      5% of $150K is $7,500 per year ($625/month in repayments).

      So saving of $2,500 per year (before calculating Citibank)

      Citibank is 3.9% so assume on $50K, interest is $1,950/year. So the potential saving is $2500 - $1950 = $550/year.

      3 years in your case would be $1650.

      Please correct me if I'm wrong though as I'm in the health industry, not accounting :P

      • SBOB on 08/12/2014 - 13:31

        Citibank is 3.9% so assume on $50K, interest is $1,950/year. So the potential saving is $2500 - $1950 = $550/year.

        minus the ongoing monthly payments that you need to make on the citibank loan, which would reduce those savings.. but im not sure if they payments on the citibank loan are structured so that there is just some random 'minimum' payment or a payment that the total is paid off within 3 years..
        If you structured it so it was paid off in equal payments over 3 years the total savings would be ~ your calculated saving over 1.5 years (so about $800)

      • mranderson978 on 08/12/2014 - 14:00

        Your maths looks right, but most people are actually making repayments and not paying "just interest"

        Assuming 5% interest it works out at $200/year

  • watwatwat on 08/12/2014 - 12:23
    +2

    Hm title says you get 3.9% interest. This is not guaranteed unless you have a great vedascore.

  • aurotaro on 08/12/2014 - 12:28

    Been getting a couple of phone calls from the Phillipines call centre telling me I am eligible for a 60k personal loan for 6 months at 0% interest rate. With a wedding coming up, I'm seeing if this could work out in my favour if used wisely.

    Need to see the effect of it on my credit rating.

    • applejack on 08/12/2014 - 12:38
      +11

      Yeah, there's only room for 4 banks in this country! Dey took er jebs!

    • EnALup on 08/12/2014 - 12:40
      +1

      Care to explain the neg what this has to do with the bank to be Australian?
      Is it illegal to have a loan from a non Australian bank? Looks like it is your personal opinion, but does not deserved a neg.

      Most of the stuff is Made in Asia and recently car manufacturer are going overseas as well.

      • burningrage on 08/12/2014 - 12:53

        The way I see it, I think it's because the post is irrelevant to the alleged bargain.

    • konazz on 08/12/2014 - 12:42

      You'll actually find that Citibank does employ quite a few people in Australia. They have a massive building (although a lot of its rented) near Townhall Station in Sydney (Cnr of George and Park St?)

    • Cluster on 08/12/2014 - 12:52
      +1

      Refinance a higher interest personal loan with Citibank, save money on interest, spend that money in the local community. What's so wrong about that?

    • salem on 08/12/2014 - 12:58

      I want this country to be one with a competitive financial industry that benefits consumers at the expense of gigantic multibillion dollar profits for large "Australian" corporations.

      • z28 on 08/12/2014 - 18:23

        So how do you do this ? Introduce more competition in the banking system to get your "local" Australian banks more competitive ? Otherwise they just become complacent.

    • machej on 08/12/2014 - 17:34

      You'll find that there are foreign shareholders of all the major banks as well.

      • SBOB on 08/12/2014 - 17:56

        You'll find that there are foreign shareholders of all the major banks as well.

        Dey terk urr dividends

  • Kempe on 08/12/2014 - 12:35

    All my life when ever a bank is offering me a deal I have looked at the opposite.
    Many years ago when interests rates were high they offered to lock people in and guess what, interest rates dropped and people were locked in to very high rates

    Banks exist to make money for shareholders so why would the offer depositors a good deal?

    • Cluster on 08/12/2014 - 12:50
      +3

      Sometimes you can beat the banks at their own game. Almost 5 years ago I opened a 7.3%pa term deposit with Rabo Bank. Then interest rates plummeted. I'm getting more from the term deposit, after tax, than I'm currently paying on my mortgage. The term deposit runs until mid 2015.

      This 3.9% offer is a screaming good deal if you're refinancing a personal loan that's currently sitting at much higher interest. Loans are unlikely to become much cheaper from here on.

    • Devils Advocate on 08/12/2014 - 13:00
      +1

      There is expected to be two cuts of 25 basis points next year. Even after that this is still a great rate

    • ajobbins on 08/12/2014 - 18:05

      Quite simply really. Citibank are making a very aggressive push into the Australian market trying to poach customers from the Big 4.

      There have been some fantastic deals from them lately. I have a Citibank Signature VISA with a $0 annual fee for life from their promotion earlier this year. Never use it, but it's nice having a free backup card for travel, plus I get two free lounge passes a year.

      I've just singed up for this deal this afternoon. Pretty impressed, all approved in a couple of hours and I can see my requested limit in Citibank online banking. Will use this to pay off the car loan I have with CBA we're paying about 12% on.

      • burningrage on 08/12/2014 - 23:14
        +2

        I am grateful for their Credit Card ranges…

        From the oldies but goldies Platinum Fee-Free-For-Life then Signature Fee-Free-For-Life and now Visa Infinity. I think I can't find anything better than Citibank Credit Cards except MC28 Degrees.

        Once, their Home Loan was the cheapest, 4.79% when everyone was 5% and above. Nowadays you can get 4.53% or even less from other banks (Heritage i think?) but still you can always ask them to be more competitive. I recently being granted further discounts.

        Their current rate is 4.68% and that's before Citigold discount of 0.15% or 0.20%. Totally crazy stuff.

        But I hate their customer service and their internet banking to death. They also lack in keeping pace with innovation. While Westpac can do cashless atm, they're still sticking their finger in their ass.

        This Ready Credit thingy is great but weeks ago, it was 2.9%.

        I wish this bank every success as I think AUS desperately needs someone to challenge the big 4.

  • [Deactivated] on 08/12/2014 - 12:50

    Please help…
    I took a car loan in mid 2014 of $15K with IMB bank and have almost $14k remaining at 7.9%. Loan is for 7 years.
    Can I take the advantage of this deal; borrow a loan from Citibank for that amount; pay out IMB and then start paying off the loan to Citibank.
    Would I be able to save money on interest if I do that?

    • konazz on 08/12/2014 - 13:08
      +2

      Remember, your car repayments will be more than double (14k paid off over 6.5 years remaining vs $14k needing to be paid off in <3 years).

      If you can manage the higher repayments, then go for it, it'll save you a fair bit.

      • [Deactivated] on 08/12/2014 - 14:24

        thats true.. In my case I am better off sticking with the loan I have currently as the pressure of double payment could be too much.
        I am anyway planning to pay off the loan in 3 years time.

    • Smigit on 08/12/2014 - 13:11
      +1

      Without doing any maths I imagine you'd end up ahead. Something to keep in mind is the term of this loan is three years, which to me seems a lot shorter than the seven years you are on so you'd need to work out whether you can handle the higher repayments required to hit those timeframes.

      You'd also want to check whether there's any early repayment fees associated with your current loan.

      • [Deactivated] on 08/12/2014 - 14:23

        No early pay out fees for me.. I have taken the loan for 7 years just for smaller repayments but planning to pay it completely within 3 years time.

        • sunarde on 12/12/2014 - 01:51

          if you do plan to pay it off within 3 years.. Will you be increasing your repayments this year? If so I'd say the citibank loan will save you quite abit as there is no early pay out fee.

          If you're thinking about increasing the payments say later next year but your nor 100% sure.. then up to you :)

    • z28 on 08/12/2014 - 18:28

      Maybe - you will save on interest for the first 3 years, after that the real interest (from Citibank) will kick in at 19% (?). So you need to work it out carefully: what are you going to do after 3 years ? pay it off in 3 first years if you could, or hopefully another offer like this comes along when you need it.

    • burningrage on 09/12/2014 - 13:45

      Correct me if I am wrong but isn't it for car loan the lender would already have capitalized the future interests into the loan?

  • burningrage on 08/12/2014 - 12:54
    +1

    I think I'll wait for another 0% 15 months balance transfer credit card offer…

    This is too much hassle.

  • Jayphen on 08/12/2014 - 13:03

    It can't find my score :(

    • burningrage on 08/12/2014 - 13:12

      I don't think it does. It just shows Good, Excellent, Average, Below Average…

      • Jayphen on 08/12/2014 - 15:09

        I mean it doesn't show my band. It says it can't find my information. Not sure if it's because I've had my driver's license for under a year so it's not on file

        • burningrage on 08/12/2014 - 16:00

          If you haven't taken a loan since you have your driver's license I think it would be the reason why…

  • attfiecz2 on 08/12/2014 - 13:43
    +2

    I'd love to know how it works out the 'score'.
    I have never missed a payment on anything in 20 years and still only get Very Good, not Excellent.

    • ShortyX on 08/12/2014 - 15:14

      Just read that excellent means you're in the top 20% of the Australian credit-active population.

      Since it's not a personal scale, perhaps there are others who have a good reputation like yourself but are on higher incomes or borrow more money so that puts them higher than you in the 'ranking'?

    • UncleRico on 08/12/2014 - 15:21

      Ditto. My Veda score is officially excellent at 840 according to www.getcreditscore.com.au, but it's only classified as very good according to Citibank's check, meaning the deal is 4.9% rather than 3.9%.

      The difference gobbles up 90% of the disparity between my mortgage and the loan rate, so I'll take a pass…

    • burningrage on 08/12/2014 - 16:02

      You think that's bad, mine is "average".

      Never missed a credit reportable payments like home loan or credit card (less than 5 years old)…

    • mxlegend99 on 08/12/2014 - 16:32
      +1

      Mine come back as 872, rated as excellent and I am definitely not a high earner.

      I currently have a $20k car loan being repayed, $4k in credit card debt although I have been paying up enough each month to avoid interest, and I have a $4k denticare debt that is interest free. Throw in $130 a month on my phone bill ($100 plan, Xperia Z2 phone on 1 year contract, insured) and I was certain all these debts would count against me. Maybe it helps my score though. Tempted to take out a loan big enough to consolidate these dents, but if I didnt have it paid up within 3 years I would be jumping up to a super high interest rate.

  • jaypee06 on 08/12/2014 - 14:39
    +1

    I applied for the 2.9% one a while back but didn't end up withdrawing any of the money from the line of credit that I got approved for. Here's why. Interest and any other charges (I don't believe there's any) accrue interest at the standard variable rate (I think 19 odd %). Any repayments you make repay the principal (the amount accruing interest at 3.9%) first. This means you need to repay the amount you borrowed first before you can start paying back the interest and other charges that will be accruing additional interest at 19%.

    • Cluster on 08/12/2014 - 16:19

      Normally with every credit card T&C I've seen any repayments are applied to debt incurring the highest interest rates first. Citibank are not clear what the order of repayments is. The following clause is sneaky at best.

      http://www.citibank.com.au/global_docs/pdf/MCG9700.pdf

      4.8 We may use any payment we receive in accordance with this
      contract to reduce the balance owing on your loan account
      in any order we choose. Where you have more than one loan
      or account with us and you do not notify us when making
      a payment as to which loan or account you want us to apply
      your payment, we may apply your payment to any loan
      or account we choose.

      • Smigit on 08/12/2014 - 16:38

        The post and linked page states the following which to my reading is lowest interest rate loan is payed of first (given the Balance Transfer is at 3.9%, and everything else is 19.5%). I'd assume cash advances and retail purchases are anything against the card.

        The promotional interest rate from Citibank applies to balances transferred with this offer at point of application and cheques-to-self with this offer within 90 days of account opening. Payments are applied to BT amounts before cash advances and retail purchases, and if your account has more than one BT, the BT at the lowest interest rate will be repaid first.

        It is probably how they make money on this (by essentially making it hard to pay off the 20% that's on a high interest rate). In any event, it won't really matter either way as long as you don't use the credit card associated with the account.

        • Cluster on 08/12/2014 - 16:49

          Logically you would think any interest accrued by the 2.9% deal would also be charged at 2.9%, unless the borrower takes the full 80% in which case any interest will automatically cross the 80% mark. That's okay. Keep the account below 80%, don't make any purchases using the supplied card, and all is sweet.

          The one bit of wording from Citibank that has me concerned is that the borrower can take one cheque to self at up to 80% at 2.9%. If I was a lawyer employed by the bank I could interpret that as '2.9% taken out once, everything else that appears on the account is at 19.5%, including any interest added'. It should still be the case that all payments go to the highest interest debt first however, so the borrower could pay off the interest on the day it gets added to the balance to effectively make the 19.5% rate irrelevant.

        • jaypee06 on 08/12/2014 - 17:05

          @Cluster:

          Damn… I would have taken advantage of it then if all I had to do was pay the minimum 1% each month plus the interest charged.

      • jaypee06 on 08/12/2014 - 16:47

        Well despite there being 2 parts to the loan (the amount accruing interest at 3.9% and the amount accruing interest at 19-odd-%) it's still only the one ready credit loan and Citibank can apply repayments to it as they see fit.

        I was looking at doing the 2.9% offer and paying off the minimum balance each month (1%) and then paying out everything owing after 2 years and I calculated the actual interest rate to be 6-odd-% which was a deal breaker for me.

    • damoo on 08/12/2014 - 16:57
      +1

      It's been illegal for banks to do this since 2012.
      Citibank can say what they like in T & C's, but the law is the law.

      Probably just outdated T & C's I'd presume.

      • mjs on 08/12/2014 - 17:02

        No - this is not a credit card, it is a Ready Credit facility.

      • jaypee06 on 08/12/2014 - 17:03

        Interesting. Do you have a link to more info on this?

      • chumlee on 08/12/2014 - 21:46

        It`s not the law.

        Financial institutions have their own payment hierarchy and generally whatever attracts interest first is where they allocate the payments made by the customer.

      • Cluster on 08/12/2014 - 23:06

        Citibank's T&C are dated 2011, so it's likely we're looking at an old document. If in doubt, just ask Citibank about the order of repayments.

        Edit: Here's a link to the relevant reforms:

        http://www.bankingreforms.gov.au/content/content.aspx?doc=fu…

        "Credit card providers will be required to direct repayments to the most expensive part of your credit card debt first - making it easier to reduce your debt faster."

        Now, the personal loan is not a credit card, but you can balance transfer credit cards to it and there's a debit card that acts like a credit card as far as merchants are concerned, so…

  • jiakz on 08/12/2014 - 16:36

    For those that signed up, did anyone have issues uploading their supporting documents or even emailing them.
    Getting errors on both.

  • ajobbins on 08/12/2014 - 18:25

    Anyone know the actual process for requesting a cheque to self? I see it mentioned all over their website, not no info on actually how to make the request. Hope I don't have to call them (painful)

    • Smigit on 08/12/2014 - 19:27

      The request happens when you have everything on hand to activate the account. So first you need to apply and will specify an amount in the application. Then you need to wait for approval, and if approved they'll mail you out details and the card. You can then call to activate and request the balance transfer, which can go directly against an existing loan or come in the form of a cheque. That'll take another week or so to arrive.

      It was a slow process, but for what it's worth I found them pretty quick and easy to deal with over the phone.

      • ajobbins on 09/12/2014 - 13:18

        Great, thanks. I'm already all approved and can see the amount I requested in my internet banking. Will request it when the paperwork arrives.

        Wonder if they can just direct credit to my citibank cheque account rather than mail me a check that i'll just deposit back into the account with them anyway.

        • Smigit on 09/12/2014 - 14:50

          See how you go. They said I couldn't get an electronic transfer into my banks savings account, but I'm not sure if the situation is different if the account being transferred into is a Citibank one or not.

  • BALLE BALLE on 08/12/2014 - 21:44

    Before proceeding please go through reviews :(
    http://www.productreview.com.au/p/citibank.html

    • SBOB on 08/12/2014 - 21:49

      You could post one of those for almost any sizeable bank…

      I've only had one issue with my citibank so far, which resulted from them not showing account numbers out of some idea of security… As I hadn't received my paperwork yet it took a while on a phone call to get them to read it out to me… (so now instead of being securely visible to me behind a banking login it's insecurely written down on some paper ;) )

      Apart from that I've had no issues and pretty quick phone response to the few times I've called them for other things

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