My parents tried to negotiate with CBA, only got 3.1%, investment variable less than 70% (started in 2015). Even on CBA's own website it says 2.49%. Why is it like this? I suggested refinancing to them, do all banks jack rates once the customer is in? Why is there such a huge difference between what they offer current customers vs new customers?
What Variable Investment Property Rates Are People Getting?
Gerry H on 05/05/2022 - 18:18
Last edited 05/05/2022 - 18:19
Last edited 05/05/2022 - 18:19
Comments
Refinance, get up to $4k cashback as well.
P&I investment at 2.7% with CBA (pre rate rise). Tried to negotiate to no avail, so I am going through with a refinance to 2.34%
If you don't refinance you pay 'lazy tax' and the banks very well know that majority won't refinance. I have just threatened today to leave Suncorp. My fixed rate will finish next month and they offered me 3.15% on a variable rate. I will refinance to somewhere else.
It should make sense for banks to rather retain customers (cheaper) than poach new ones via mortgage brokers. But it seems they do not care.
Big banks are familiar but offer very poor deals. Try lenders like TicToc, Athena and UBank. TicToc even offers a real offset for $120/yr.
The way it works is over time the banks do not pass on the full interest rate reduction, so whenever rates go up they pass on the full increase immediately, but when rates go down they pass on a partial reduction usually 30 days later.
So over time the actual rate of the product given to new customers is lower than customers who have been on the same product for several years or longer.
They also send out letters stating when rates are reduced or increased, look over all your paperwork for the mortgage, and compare the rate reductions to the actual cash rate change by the rba. You will be able to see the rate difference over time.