New home loan lender offering 1.99%pa for Refinances only. Offset account is available (Non guaranteed by govt as not ADI)
Home Loan Refinance 1.99% p.a. Owner-Occupied Variable with Offset @ Nano
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silenthillrocks on 30/06/2021 - 13:05 nano.com.au (449 clicks)
Last edited 30/06/2021 - 18:44 by 1 other user
Last edited 30/06/2021 - 18:44 by 1 other user
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*Nano is not covered by the government’s financial claims scheme which protects deposits up to a limit with ADIs.
yeh thats a big downside to be aware of. tictoc is better in that respect for slightly higher rate (2.04%)
Very important point!
As Nano are a non-ADI lender, they don't have separate offset accounts (because they can't), instead it's a fancy redraw account (they call it a "sub-account"). That means though if they go under your offset account will just roll into your loan.
So say you have a $500k loan and $200k in offset, your debt to be sold/refinanced will be $300k. From an ADI though the debt would still be $500k and you'll be added to a list of people waiting for their money back (your $200k) from the Gov't or whoever. There's also an initial $20b ADI limit too, so even though ADIs are 'guaranteed' for $250k (per person), what you actually get back might be less.
Very interesting, so in a way this would work out better as opposed to an ADI for this particuar situation.
good insight
Will the ato regard it as an offset then
Also this isn't really an offset arrangement…. sounds more like a redraw
Yeah. It says "the offset sub account sits within the customer’s home loan account, meaning that it does not have a separate, stand-alone account number. As the offset sub-account is not a stand-alone account, the funds can only ever be used to offset the loan account. The funds are not deposit funds."
I normally close the tab when I see star ratings or feedbacks on a site.
they launched yesterday, must be one vote of 5
https://www.smartcompany.com.au/coronavirus/fintech-verteva-…
Has some sort of history behind the company but the whole thing looks like something you’d find on kickstart with the ‘disrupting the industry’, ‘turning it on its head’.
The only thing missing is ‘cutting out the middleman’ and ‘affordable luxury’ ;-)
I still wouldn’t take my mortgages near it though
100k minimum PAYG income needed to apply
Boomers only.
You'd need over 100k income to buy in Sydney or Melb though (whether it be couple income combined or single)
Not a true offset account - this is very misleading marketing. Gets a neg from me, 'dawg.
Just wondering, when you say not a 'true' offset account, what exactly makes it not true (other than being a non-ADI lender)?
If I wanted to turn my PPOR into an IP down the track, would the interest on the whole loan amount still be tax deductible?
Assuming I make all additional loan payments/withdrawals from this non true offset account?Or will the withdrawal be treated as a redraw from the original loan?
This is not tax advice or anything since im not a tax specialist or anything.
Homeloan interest is an expense incurred to earn income when the loan is for investment purposes.
- Offsets = You have a savings account + homeloan account. The bank has basically agreed to charge you interest on your homeloan account to the extent of the credit risk / exposure they have to you as a borrower. In other words, the net position.
You can take money our of your savings to go on a holiday and its still fine. The additional interest is still associated to a fully deductible loan
- Redraw / whatever this is. If you redraw money for a holiday then that portion of the loan technically was not for investment purpose.
BUT in reality - i have never heard or met anyone who has been audited for this.
The main thing i care about is having access to my funds when i want to draw on them. A redraw facility does not provide you the same rights. The bank has every right to reduce the redraw facility… See here https://www.theguardian.com/australia-news/2020/may/01/custo…
Redraw = new borrowing = must be for investment purpose to be tax deductible
@silenthillrocks: So just to confirm,
The 'offset' account offered here by Nano / non ADI lenders, would be classified as a redraw / new borrowing??
If I used money from Nano's 'offset' account to go on holiday, I will have contaminated the loan and lowered the maximum tax deductible amount.
Refinancing only.