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BFCSA investigates fraud involving lenders, spruikers and financial planners worldwide.  Full Doc, Low Doc, No Doc loans, Lines of Credit and Buffer loans appear to be normal profit making financial products, however, these loans are set to implode within seven years.  For the past two decades, Ms Brailey, President of BFCSA (Inc), has been a tireless campaigner, championing the cause of older and low income people around the Globe who have fallen victim to banking and finance scams.  She has found that people of all ages are being targeted by Bankers offering faulty lending products. BFCSA warn that anyone who has signed up for one of these financial products, is in grave danger of losing their home.


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BFCSA: Lenders tempt fixed terms borrowers with more rate cuts and cash offers

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Lenders tempt fixed terms borrowers with more rate cuts and cash offers

Australian Financial Review 01 Feb 2019 5:25 PM

Duncan Hughes


Lenders are chopping rates for fixed-term mortgages to tempt new borrowers in an intensifying battle to increase revenues and profits, despite deteriorating property market conditions.

But short-term funding pressures mean lenders continue to hike variable rates.

ME Bank has followed recent variable rate rises by NAB and ING to increase variable rates for existing customers by 18 basis points, while it will lift variable rates for new customers by 8 basis points. ME hiked variable rates by 10 basis points last month.

ING, the nation's fifth largest home loan lender, this week announced its third round of rate rises in seven months.

The margin between the rates for a three-year fixed home loan and an average standard variable loan has increased from 29 basis points to 39 basis points over the past year, according to analysis by Canstar, which monitors rates and fees. The difference has drifted to 11 basis points for two-year rates.

Sally Tindall, research director at, said: "While banks are hiking rates for existing customers, some lenders were cutting rates for new customers to get more business in the door in a slowing market."

"If your bank decides to hike rates in 2019, you don't have to take it lying down," said Ms Tindall.

"If you're on a variable rate it's your right take your home loan down the road to a lender offering a more competitive rate."

At the same time, regulation-lite shadow banks, such as PepperMoney, are increasing competitive pressure with $2000 cash back offers for sub-prime borrowers, who are considered to have higher credit risk for a lender.

Teachers Mutual Bank and its affiliates, which include Firefighters Mutual and UniBank, are the latest to cut by reducing one- to five-year principal and interest fixed rates by up to 20 basis points.

It means the new headline rate for a one-year fixed rate is down 10 basis points to 4.04 per cent. For five years the equivalent product rate is 4.61 per cent, a decrease of 20 basis points.

Other lenders to recently decrease fixed term rates include Bank of Queensland and Adelaide Bank.

For example, ASX-listed Adelaide Bank has announced it is cutting fixed rates for new borrowers by up to 40 basis points on its owner-occupier principal and interest loans, investor, principal and interest loans, and interest-only loans ranging from one to five years.

Bank of Queensland has cut owner occupier and investor fixed term rates by up to 10 basis points. Other lenders, such as Westpac Group, are offering $2000 signing on incentives.

Last January the average three-year fixed rate was 4.06 per cent, or 29 basis points higher than the average standard variable rate of 4.35 per cent, according to Canstar

The average three-year fixed rate is today 4.04 per cent and average standard variable rate 4.43 per cent, its analysis shows. The two-year rate is 3.96 per cent.

The widening discount reflects a decline in bond yields, which drive the cost of funding for fixed rate loans, but a rise in bank bill rates, which affects the cost of funding for variable rate loans.

For example over the last 12 months the 10-year bond yield has fallen from 2.85 per cent to 2.2 per cent and the two year bond yield from about 2 per cent to 1.76 per cent.

But the three-month bank bill rate has gone from just below 1.8 per cent to about 2.08 per cent.

Next Tuesday the Reserve Bank of Australia meets for the first time this year with some economists arguing cash rates will be cut later this year from 1.5 to 1 per cent, which would trigger a new round of interest rate reductions.


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