This was posted 9 years 10 months 2 days ago, and might be an out-dated deal.

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1yr Fixed Rate Home Loan 3.75% with No Annual Fee, Offset and Redraw if You Join Peoplecare

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1yr Fixed Rate Home Loan 3.75% with No Annual Fee, Offset and Redraw if You Join Peoplecare
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mangoburger on 20/01/2015 - 10:51 peoplecare.com.au (483 clicks)
Last edited 20/01/2015 - 11:51 by 1 other user

Got an email from Peoplecare, they are doing a deal with Community First. Can't find a cheaper rate than this so seems like a good deal. Shame it's only for a year. By the way I've been with Peoplecare for a few years and in my opinion they cover heaps more stuff than other health funds I've used so double bargain.

Comparison rate is quite high, since most credit unions will charge you up front for valuations, legals and establishment fee, whereas banks may wear some of this, and then there would likely be a switching fee to change product at the end of the 1 year.

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  • mangoburger on 20/01/2015 - 10:57

    I should note that I spoke to the rep and the deal is not limited to NSW customers, I am in VIC and they said no problem.

  • Basslync on 20/01/2015 - 11:05

    Wow! Great rate

  • brucebruce on 20/01/2015 - 11:07
    +3

    its the comparison rate that you should care about and its 5.74%. no.deal.

    • mangoburger on 20/01/2015 - 12:34

      Comparison rate is also misleading, it's based upon $150k at 25years. How many people will have precisely $150k to move to fixed loan? Change your parameters and your own comparison rate will change with them.

      Besides that, in today's world almost nobody will stay with any bank that long, so it's unrealistic. If the bank accepts additional repayments, then in theory you could make extra repayments without incurring any break costs as long as the standard variable doesn't drop below 3.75%, and how likely is that?

      • brucebruce on 20/01/2015 - 12:49

        how much 'extra' repayments one can possibly make within one year is the key then.
        i know i can't make too much repayments on top of what i'm already paying… still on 4.48% comparison rate with 100% offset & redraw facility and no fee for life, i'm happy with my current lender and won't be refinancing.

      • Matt P on 20/01/2015 - 18:07

        a lot of loans use the 150k/25y example. This allows you to broadly compare different loans to each other

  • thydzik on 20/01/2015 - 11:10

    why's the comparison rate at 5.74% so high, even though no fees as well?

    edit: since the loan goes to 5.87 variable after the 1 year, comparison is over 25 years so it bumps the rate up.

    this is a good deal as long as you switch after the first year.

    • hys on 20/01/2015 - 11:21

      Are there any exit/break fees though ?

    • thydzik on 20/01/2015 - 12:54
      +3

      here are some additional fees that I was made aware of;

      Application Fee - Applies at the time of application, to variable and fixed mortgage secured Home and Investment Loans.

      First application (includes 2 splits) $500.00
      Each additional split thereafter $150.00
      Solicitors preparation fee At cost
      Valuation fee At cost
      Search fees At cost
      Loan top-up on existing loan Up to $250.00
      split loan request $500.00
      Switching Fee $500.00

      more info available here;
      http://www.communityfirst.com.au/Assets/1158/1/FeesandCharge…

      • mangoburger on 20/01/2015 - 13:32

        Thanks thydzik useful info. What is a split?

        The switching fee would apply at the end of the 1st year if you continued with them, however if the loan was high enough value and you had good relationship with your rep you could probably push them to waive it.

        • thydzik on 20/01/2015 - 14:00
          +1

          I believe a splitting fee is the fee for taking part variable and part fixed. so not applicable.

          switching fee shouldn't be applicable for leaving after the first year to another bank.

      • thydzik on 20/01/2015 - 15:41

        I did some further calcs, even if there is $1000 worth of setting up fees, you are still looking at a comparison rate of 3.79%, as long as you exit after the first year.

        edit: on a $150k loan, the trouble is worth about $2925 is savings compared to their comparison rate
        or saving of $1125 compared to ubank.

        • AlisonP on 04/03/2015 - 16:43

          No, it's not.

          Their rate is 3.75% vs UBanks 4.29%.

          That's a 0.54% saving, which on a $150,000 loan is $810 per year. With their $1000 setup costs, you're $190 out of pocket vs UBank.

        • andyman1908 on 04/03/2015 - 22:33

          As I mentioned in the other post, Ive queried these guys and they advised I'd be up for approximately $1800 in fees when I apply.

        • thydzik on 05/03/2015 - 10:19

          @AlisonP:

          look at the date when I made the post.

          have we had any rate cuts from then to now…

        • AlisonP on 06/03/2015 - 16:00

          @thydzik:

          Apologies. I didn't realise the age of the post.

        • thydzik on 09/03/2015 - 11:03

          @AlisonP:

          no problem.

          your post does highlight how careful you have to be with fixed rates,
          is less than 1 months time the fixed rate's benefits is gone.

  • mangew on 20/01/2015 - 11:12

    will revert back to the standard variable rate at that time which is currently 5.87%p.a (after the 1 year fixed period is over)

    The boring, but necessary, fine print:
    The above offers is only available to members and employees of Peoplecare. *Interest rate is current as at 6 November 2014 and is subject to change. **Comparison rate is based upon a loan amount of $150,000 over a loan term of 25 years. WARNING this comparison rate is true only for the example given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. After the honeymoon period the interest rate of 3.75%p.a. will revert back to the standard variable rate at that time which is currently 5.87%p.a.Offer only available for members and employees of Peoplecare for a limited time on new loan applications made between 1 January 2015 and 31 March 2015 which are settled by 30 April 2015. It is not available for internal refinances within Community First. The above offers are not available with any other offer and can be withdrawn at anytime without notice. Please consider the relevant Product Conditions of Use available from Community First Credit Union Limited by calling 1300 13 22 77, visiting your local Financial Services Store or www.communityfirst.com.au before deciding whether this product is appropriate for you. This is general advice only and does not take into account your individual objectives, financial situation or needs (“your personal circumstances”). Community First Credit Union Limited ABN 80 087 649 938 AFSL/Australian Credit Licence No. 231204.

    • Cluster on 20/01/2015 - 11:14
      +1

      This is most important: the up front deal for 1 year doesn't matter when you have up to 29 more years to go. Switch lenders after 1 year? I switched from CBA to UBank in SA and it cost $650 (half that was government fees, rest CBA exit fee).

      With UBank presently at 4.54% variable, no fees and free redraw.

  • CyberMurning on 20/01/2015 - 11:22
    +1

    too much hassle for just one year with them, make it 10 years then everyone will go over.

    • hoxygt on 20/01/2015 - 12:36
      +1

      Agreed, I don't mind bouncing insurance or other easily shifted product but home loans….

      then again it might be $1,000 per $100,000 loaned depending on you current rate?

      • CyberMurning on 20/01/2015 - 12:48
        +1

        hmm also true compare with ubank rate 4.54%, with example loan amount $350k this one potentially save you nmore than $2k in one year!

        not bad for pocket money.

        • hoxygt on 20/01/2015 - 13:04

          Yeah even with UBanks slow and annoying processes, its maybe 10-15 hours work = $150/hr, who wouldn't do that work?

      • homersyd on 20/01/2015 - 14:19

        ditto, dont forget it would most likely affect your credit rating…

        • hoxygt on 20/01/2015 - 15:53

          How would it affect you credit rating?

        • homersyd on 20/01/2015 - 16:06

          @hoxygt: I'm not 100% sure, but probably because everytime you refinance/apply a new loan they will have to request access to your credit files. And more request for access apparently could have an impact on your credit rating. (I read this comment from OZB a while ago)

        • hoxygt on 20/01/2015 - 17:08

          @homersyd:

          Be good to have some evidence. My understanding is your credit rating is basically your default history?

        • homersyd on 20/01/2015 - 17:23

          @hoxygt: there you go (mind you who knows if even he/she is correct…)
          https://www.ozbargain.com.au/node/120580#comment-1655065

        • varunynr on 20/01/2015 - 23:34

          @homersyd:

          I can confirm that I got my credit rating adversely impacted by applying several credit cards within 3 months time and I was told the same thing by Veda consultant. He mentioned that the rating improves if there is no request for access for sometime. I think this may be true for home loans too. But someone has to confirm.

        • homersyd on 28/01/2015 - 10:37
          +1

          @varunynr: thanks mate, that's good to know.

  • IMBI3 on 20/01/2015 - 11:49
    +3

    Please state this is honeymoon rate in your title

    • mangoburger on 20/01/2015 - 12:29
      +3

      It's only honeymoon rate if you're obliged to remain with them after the first year, I didn't see that anywhere in the fine print. Title states that the offer is 1 year so not misleading.

    • Snoopy113 on 01/03/2015 - 19:28

      This isnt a honeymoon rate. Its a 1 year fixed rate. It's also a worry that 3 people up voted you!

  • fleetoiler on 28/02/2015 - 14:35

    Ok so this is an amazing rate, could save us thousands of dollars and is probably worth the hassle. Even if rates are cut again this week, I doubt other banks will be able to come close to this rate (in terms of just a 1 year outlook then moving on that is, ignoring the flawed comparison rate)? What's the lowest/best comparison to this, is it UBank?

    How much more expensive is peoplecare health insurance and how does it compare to the others? Is it worth just taking out the cheapest policy they have (to be eligible for this HL rate) and keeping my existing health cover? It looks like pricepal/starthere will give $100 cashback to take out a health insurance policy so it might be worth it just to become eligible for this HL rate.

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