Thoughts on ubank w/Offset Offer $3k Cashback

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ubank

• 

  garetz on 31/10/2022 - 18:04

  The way banks screw you is to not pass on the full interest rate decreases which takes 30 days to initiate then when rates go up they get passed on immediately at the full rate.

  The more the rates fluctuate the bigger the difference on your loan vs what it should be. That is why you need to keep calling and asking for rate reductions or you could end up paying much higher interest over time.

  If they give you 3k cashback you think they are going to let you discharge the loan and go with someone else immediately ? Read the terms on conditions.

  • 

    Trying2SaveABuck on 31/10/2022 - 18:40

    +2

    should be illegal to not pass on full cuts if they had previously passed on the full rise

  • 

    trongy on 01/11/2022 - 09:25

    +1

    I'm with Ubank and this year they have been raising their interest rates around three and a half weeks after the RBA announcement.

• 

  MadgeH on 31/10/2022 - 21:45

  +1

  Hi Op

  Overall the feedback I'm getting from clients is that Ubank is good to deal with so no complaints.

  Not the absolute best rate/cashback combo in the market but anything will beat your current rate tbh.

• 

  MrMarket on 01/11/2022 - 08:02

  +1

  it depends really on your circumstances, if you got a lot of offset it better to go with one that offer offset like Macquarie bank 4.31% and offset account so if you got 100-200K offset that will save you around 4K-8K a year on 4.31%

  you can also pay more to the mortgage as an option but offset account is much more flexible

  if you don't have a lot of money to offset go with no frill lowest rate bank

• 

  jeeg on 01/11/2022 - 12:18

  I have always wondered - say on a 100% offset account for a loan 500K. If you have say 500K cash in the offset account, does that mean your monthly repayment for the 500k loan will go fully to the pay down of the actual principle, i.e. no interest being charged?

  • 

    flagger on 01/11/2022 - 12:22

    +2

    Yes. If you can fully cover your principle with what's in the offset, you will not get charged interest. Just got to make sure to make the minimum payment every period.

    • 

      jeeg on 01/11/2022 - 14:17

      cheers mate.

      So say in time you still maintain that 500k cash in the offset account - but the principle has been reduced to say 300K - meaning we now have a surplus of 200k in the offset that does not go towards the loan itself. Do we then earn an interest based on this surplus?

      • 

        MrMarket on 01/11/2022 - 14:58

        +3

        There is no interest earn on surplus offset, if you can match your loan outstanding with the same amount in offset then you pay no interest
        whatever amount you pay each month to the bank it all going toward paying off the principal.

        you can pay off your mortgage super quick and has access to cash at an instant for share market crash etc…

        you always keep your offset at the same level or below the loan amount, excess cash go to saving account or use for investment don't leave it in offset account

        • 

          jeeg on 01/11/2022 - 20:26

          @MrMarket: thanks mate. I understand better now.

        • 

          hasher22 on 01/11/2022 - 23:03

          @MrMarket: Thanks, this cleared up some questions of an offset account like a noob like myself.

• 

  bumperplates on 03/11/2022 - 18:50

  I really appreciate all of your advice! I'm now as stuck as to what to do! I went back to my current lender and they can reduce it down to 4.54% It's just a pity that I need to call to force their hand as a long time customer.

  I probably have around 20K in an offset, so it it worth having one, or just have a normal account, or find a loan with a Redraw only?

  The other side of this was trying to consolidate my Credit Card who I'm with at the moment which is Citi. I have one of their Platinum Rewards Cards, and fee free based on an old loan package I was on, and not sure if It's worthwhile moving to another provider to follow the Rewards train, or keep the CC seperate to the Lender of choice.

  On a slightly other note, anyone use a Great Southern Bank Credit Card as their main driver, instead of the using CC churning?

• 

  MrMarket on 03/11/2022 - 20:42

  It simple maths do they charge any fee for offset?
  Let assume they do and 300-400 usually is the going rate
  If you got 20k offset and they charge you $300 for the package

  20k offset on 4.54% will save you $908 a year
  So you be saving will $608

  If you don’t intend to use the 20k or need to access it without delay in the next few years then if I was you I get rid off the offset and put into the loan with redraw and save extra $300

  Offset account usually either more expensive or with fee attached and it only benefit if you have large offset like 100k or more else the benefit is minimal and you better off paying more into the mortgage and use redraw .

  In my early years of having a mortgage in my early 20s
  I go for the cheapest rate redraw loan facility I pump every spare dollar into the mortgage as extra payment and use redraw.

  CBA platinum credit card is a ripped off get rid of them
  If you want reward card I think Citi card is better or look for no frill no fee credit card