Guess December 2, 2008

What will GE Money/ Afig Wholesale and Wizard do???

Nick December 2, 2008

Don’t be too quick to give the banks a pat on the back…What about all the off market moves when rates were going up????…NAB have announced the full 1% but what about HomeSide????

michael heckendorf December 2, 2008

NAB and NAB BROKER are two different animals, it seems. Please ensure the Red Star is exposed for their actions.

MH

Louis December 4, 2008

I Predict GE Money/AFIG will reduce the rate by 1.0% on 15/12/08.

National Mortgage Company December 4, 2008

National Mortgage Company is passing on the full 1% rate cut.

Tony Harris December 4, 2008

Louise,what do you know that we don’t?
That seems to be a big call!
All will be revealled

Louis December 4, 2008

That’s right Tony…a very big call. I believe GE money has had a serving from the powers to be, hence, they are rebating clients $500 off their exit fees if loan discharges in December.

Stephen December 4, 2008

Anyone know about Pepper Home Loans? I think a list should also be compiled of the lenders who do NOT pass on interest rate cuts.

Kathy December 4, 2008

I can’t believe we are still playing the game of which institution is going to reduce the rates by how much, only to have them switch again at the next interest rate change. For example, Westpac has been prompt to reduce rates by the same as everyone else but this month decided to take an extra 20 basis points?? I think the banks have taken this all too far and have well exceeded the credit crisis excuse to be increasing their margin on the RBA rate.

Louis December 4, 2008

I don’t think so Kathy. There are real problems out there and we haven’t seen the worse yet.

Ali Taha December 4, 2008

Louis,

You’re either extremely intelligent or you work for a bank. For those of us who dont know you, why dont you reveal who you work for.

Westpac and ANZ have just raised their rates again, CBA and NAB will catch up next time. All out there to make as much money as possible, fair enough!!! But Louis, as brokers we’re getting paid on average, 10 points less for our trail commissions. Surely CBA/NAB could have passed on 0.9% and Westpac/ANZ say 0.7% and just given us our full trail back. Surely after all these opportunities to regain their margins, there is an opportunity for us to try and regain ours???

Ali Taha December 4, 2008

The banks remind me of the current American Government. Big bullies who will take every thing they can get their hands on. I hear strong rumors of 0.4% upfront and no trail in 12 months - “take it or leave it”. Might as well go drive cabs!

Chris December 5, 2008

Finally I see people discussing AMS/AFIG/GE/ mortgage lender.

Anyone have a URL for the break fees for AFIG’s standard variable?

I’m strongly considering switching to a bank lender after 5-6 years with AFIG.

I think I’m currently paying 8.72% (standard variable).
The $4000/yr saving after the switch is a decent holiday.

Stephen December 5, 2008

Pepper Home Loans have taken over my GMAC loan…my rate is….10.12%. They didnt pass on the Nov cut and still have no idea on Dec. As soon as i can i will be out of there…what a joke!!!!

Louis December 5, 2008

Ali, The beauty of this forum is that you can say what you think and remain annonymous. That way you can say the truth without upseting others. However I can tell you that I have been in finance for over 30 years spanning two major Australian Banks,one foreign bank, one major non bank and numerous other mortgage managers. I am now self employed as both a mortgage manager and broker.I can tell you that in all my years in the industry I have never seen things so bad. My prediction regarding GE Money is based on the fact GE Money have advised by memo that they will communicate the interest rate on the 15th of December. The 1.0% cut is because I believe they have been pressured by the government and they appear to follow CBA decisions with the exception of the reduction in October.

Louis December 5, 2008

Ali, driving cabs is not a bad thought. Get in quick because the demand will be strong.
I make another prediction. Brokers will be forced to use subsidiaries of the banks such as NAB/Homeside and Westpac/RAMS. Not only will commissions be cut but the rates will be higher for brokers. Therefore, the clients will be disadvantaged and will be driven to deal with the banks directly. Start building your trail book and control your overheads. Look at diversifying by utilising your current setup…. before looking at the cab industry.

Louis December 5, 2008

Chris,

The GE Money break costs from about March 2007 are as follows:
Year 1 - 1.8%; Year 2 - 1.6%; Year 3 - 1.2%; Year 4 - 0.8% and Year 5 - 0.5%. Prior to this was 1% for 5 years for standard loans and 1.2% for 5 years for Low Docs. I have just refinanced a GE Money client whose DEF was $28,800. He was on 8.75%. I sold him a CBA MAV at currently 5.94%. The interest saving in the first year is $50,580.

Paula December 16, 2008

I rang GE this morning to find out what happened with the passing on of the interest rate cut. There is a recorded message saying they expect to make an annoucement by today (16/12)

Hak December 16, 2008

seems like something funny going on, they were suppose to make an announcement yesterday.. I guess 2 weeks isnt long enough for them to decide on what they want to do..

Hak December 16, 2008

GE Money took two weeks longer than the majors, but it finally announced it will reduce home loan variable interest rates by 90 bps for Wizard loans and most third-party originated mortgages, and 75 bps for the Specialist Options range of mortgages.

“The differing amounts are due to separate channels being managed with distinct risk profiles and strategic and financial objectives,” it stated.

The rate drop follows a review of the RBA’s 100 bps cut in early December, which reduced the official cash rate to 4.25%.

The funder blamed increased volatility in the global wholesale financial market for its delay in assessing GE Money’s actual cost of funds “which is only determined in a very small way by the Reserve Bank cash rate”.

The rate reduction is scheduled to take effect Wednesday, 17 December for Wizard customers and Tuesday, 30 December for everyone else.

Louis December 16, 2008

On 5th December I predicted GE Money would reduce the rate by 1% by 15th December. I wasn’t too far off.

The fact they announced it one day late and did not pass the full 1% proves again what a bunch of a.. holes they are.

Greg February 19, 2009

http://news.smh.com.au/breaking-news-business/ge-money-offers-exit-fee-sweetener-20090219-8c5t.html

GE Money offers exit fee sweetener

GE Money’s mortgage lending business hasn’t been able to pass on the latest interest rate cut but will waive exit fees to encourage customers to refinance with the new part-owner of its Wizard Home Loans unit, John Symond’s Aussie Home Loans.

I won’t be refinancing with Aussie. I am checking out myrate which looks a lot cheaper.

Peter February 26, 2009

GE Money will waive the DEF, but if you are stuck on a fixed-rate mortgage with them tough luck. They won’t be doing anything about the associated break costs (which can be VERY substantial and make the DEF look like small change). Also, latest word is they will not be passing on any of the recent 1% cut. Before you rush out and re-finance you had better check your house still has postitive equity, no-one will re-finance your mortgage. Get a valuation, you may be in for a nasty surprise.