A Home Loan Check Up Report, based on a $250,000 loan with monthly repayments of $1891.18, shows that the Repayment Term Rankings for loan products only changed for one of the ‘Bank War' lenders despite changes to Interest Rates and Home Loan fees.
The Repayment Term Rankings used in the Report indicates which home loan products would be repaid faster than the comparison home loan assuming the same loan amount and repayment for each. The faster the repayment, the higher the Repayment Term Ranking and the greater the saving for the borrower as less repayments are required to pay off the loan.
The Report shows that the one lender that generates some change in their Repayment Term Rank, CBA, only achieves this for refinanced NAB loans because of the $1,200 cash offer they have made to existing NAB customers. However, the report also showed that, even with the improved ranking caused by the cash offer, there were still more than 100 other loan products that rank higher than the best CBA loan product.
The Report, for this comparison, also showed that of the four major banks, ANZ had the product with the highest Repayment Term Ranking of 97 but the lowest Average Repayment Term Ranking for it's products at 447, whereas CBA and NAB had the highest Average Repayment Term Ranking ( depending on which bank was taking over the others loans).
Whilst the rankings indicate which loans are likely to be paid off faster, the loan terms calculated, for this comparison, that create the rankings show that if a customer of one of the "Big Four" were to change to the top ranked loan, they could save between $40,000 and $140,000 in repayments.
The Report shows that whilst the "Bank Wars" have generated a significant amount of free publicity for the protagonists, it seems to have little real effect for either prospective borrowers or existing customers.
The full report can be read at: http://homeloancheckup.com.au/homeloaninterestrateblog/?p=349
Home Loan Interest Rate Blog: March 02, 2011
Home Loan Interest Rate Blog
The Home Loan Interest Rate Blog has been created to bring all current Home Loan, Mortgage, Interest rate and Lender News together in one place so that people can, with minimal impact on their time, keep up to date with developments in the Home Loan and Mortgage Industry.