Banks love charging fees. Making profit off its balance sheet comes at a cost but fees are money-for-jam. Imagine having a million customers paying $395 per annum! Hmm.
Whether it be the CBA Wealth Package, ANZ Breakfree, Westpac Premier Advantage or NAB Choice, they all pretty much offer the same deal … free offset accounts and a free Platinum Credit Card included.
It used to be the case that having a ‘package’ also got you a better rate, but this isn’t necessarily true anymore.
The standout ‘basic product’ is St George now offering a variable rate of 2.74%. No establishment fee, no ongoing fees, free redraw and a rate that’s cheaper than what you can get under their Advantage product.
This rate is when the LVR is less than 60%, otherwise the rate is 2.99% @ 80%
A basic-style product can be a better option if;
- Your home is unlikely going to become an investment property in the long term (in which case an offset is absolutely imperative)
- We calculate that the efficiency provided by an offset account is nowhere near the cost of $395 per annum
- You’re not wanting to ‘fix’ a portion of your debt, and
- You’re not fussed about getting another credit card (perhaps you have one that you’ve used for ages)
St George Bank will give you a $2,000 refinance rebate for switching to them (this was normally reserved for packaged products only but for a short time it applies to the basic product too!)
Anyway, there are still many borrowers out there without professional representation with home loans that unfortunately start with a 3 so maybe spread the word that they really don’t need to tip the bank every month, they’re doing just fine.