Mortgage Market Update

27. October 2016

In this update I am focusing on updates to our small business offering.

The relevance of this was highlighted last week in a  client meeting I attended, where the client is paying in the order of 1% over the going rate on  a facility of around $1m.

The client is currently paying 5.75% approx.

The banks tend to be a little coy when talking business rates, however rates around 5% are achievable, possibly even lower depending on the value of the client, size of the facility etc.

Most of the  banks are competing aggressively with each other for new business (existing customers are strangely forgotten)  and  current offers allow for most clients to refinance at very competitive rates.

Banks acknowledge there are administrative costs involved in a re-finance,  so some are also offering a  financial reimbursement for related costs, such as valuation fees, legal fees etc. This is typically dependent on the loan/facility size.

How can we help?

For anyone who has small business clients or has friends or family involved in small business, there is an excellent opportunity for Economos to work with those people  and develop an effective debt management strategy. We are committed to helping clients across a range of ‘value add’ financial services, contributing further to the trusted adviser relationship we share with many.

Our position in the market allows us to work with a wide range of commercial business lenders, providing outcomes aligned to the financial objectives of the individual client.  Commercial & business finance does not get marketed or advertised as widely as home loans so in many cases clients have very little idea as to what’s achievable.

Given many clients are now getting their 2016 returns completed this is an opportunity to discuss your financing arrangements with your accountant and myself about current arrangements.

Products and services we can offer include:-

 Commercial property lending

  • Working capital
  • Development finance
  • Trade finance
  • Debtor finance
  • Asset finance (equipment and vehicles)
  • Business transaction accounts
  • Merchant facilities

Home Loans

After last month’s interest rate easing, fully optioned  home loans are available from rates as low as 3.54% and investment loans around 3.99%.  Not all applicants necessarily qualify for this offer, however, it is certainly a prompt for those with  home or investment loans with an interest rate of 4% – 5% to discuss their situation with us.