The Home Buyers Personal Loan from bankmecu provides you a cheaper alternative without the hassle. With low rates and incentives for those making home improvements, this product is ideal for those in need of quick cash.

Overview

• Interest rate- 9.99% (9.49% if you’re borrowing for home improvements)
• Loan terms- Up to 10 years.
• Redraw facility- Yes. Unlimited.
• Internet access- Yes
• Criteria- Must be a homeowner or in the process of buying a property.

Features and Benefits

• Low rates of interest at 9.99%, and just 9.49% for those making home improvements.
• Borrow money for anywhere up to 10 years to give you lower repayments.
• Telephone and Internet banking so you can keep your finances in order.
• Unlimited redraw facility in case you need a little extra financial support.

A Cheaper Option

If you’re looking for an affordable way to borrow money without increasing your home loan the bankmecu Home Buyers Personal Loan is a good choice.

The standard rate of interest is 9.99% pa if you’re borrowing for general purposes, but those taking a loan to make home improvements get an even better rate of 9.49%. Their repayment terms are flexible, and again, those improving their home get an even better deal.

You can borrow money for anything up to 10 years, but if you’re renovating or working on your home, bankmecu will increase the maximum term of the loan to 15 years. This will dramatically reduce your monthly repayments, but caution should be exercised.

The longer the term of the loan, the more you’ll repay in total. You could take a longer term and make overpayments whenever possible. This gives you the best of both worlds.

How to Apply

You can apply for your bankmecu Home Buyers Personal Loan by sending in an application, or going through the process online. If you’re looking for money in a hurry an online application will get your a faster response.

Pros

• Very low interest rates.
• Special rates if you’re making home improvements.
• Unlimited redraws.
• Easy access.
• Long repayment terms.

Cons

• You need to be making home improvements to get the lowest rates.

This product Would Suit….

If you’re a homeowner who needs affordable credit and don’t want to touch your home loan, this product will suit you down to the ground.

If you’re planning to borrow the money to make home improvements you’re going to benefit from special rates, so when comparing this with other personal loans make sure you consider the bankmecu lowest rate of 9.49%.

This lender is known for giving customers exceptional service and product flexibility, and we suggest you put this high up on your list of potential personal loans to “check out”.

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Not only does the bankmecu Equity Loan offer the possibility of financing a wide range of needs at a competitive interest rate, you can also take advantage of the all-in-one account feature for your home loan, savings and overdraft. Essentially, you deposit your whole income into the account every month, which means you will be able to pay off your loan much faster by reducing interest charges.

The bankmecu Equity Loan: Features

The bankmecu Equity Loan allows you to take advantage of the equity in your home to finance a variety of things at a great interest rate of only 7.04% per annum. This is a much more attractive rate than that of any personal loan but, just like a personal loan, the equity loan can be used to finance any purchase or to consolidate existing, high interest debt.

In terms of repayments, this loan is highly flexible, allowing you to pay every week, every two weeks or once a month. Generally, it’s a good idea to schedule your repayments according to when you get your paycheck. This way you can ensure you make your repayments on time and avoid late fees and other penalties.

You also have the option of making extra repayments to pay off your loan faster without incurring any other penalties or fees.

The bankmecu Equity Loan also offers an “all-in-one” account for your access account, overdraft and home loan, allowing you to take full advantage of your income. By depositing your entire paycheck into your equity loan account, you’ll be able to pay your loan off much quicker while minimizing costs since interest is calculated on a daily basis. Additionally, with this loan, you can easily access your funds from anywhere in the world at any time of day or night.

Note that, beside interest charges, you also will have to pay a secured overdraft fee of per month.

Remember, though, that no matter how attractive the interest rate, the longer you take to pay it off, the more you will end up paying in interest costs. Thus, a personal loan with a higher rate but a shorter term might be a better option for you if you know you have the habit of taking as long as possible to pay back your debts.

Overall Verdict

If you’re looking for a flexible loan with a low variable interest rate, then the bankmecu Equity Loan is definitely the way to go. With its flexible repayment terms and the all-in-one solution it offers, you can’t find a better option to take advantage of the equity in your home.

As with any loan, though, remember that the faster you pay off your bankmecu Equity Loan, the more money you will save in the long term. So, before you decide on a loan product, make sure you do your due diligence to ensure you really are making the best choice for your personal financial situation and requirements.

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The bankmecu goGreen Home Improvement loan offers an easy way to update any home with money-saving environmentally-friendly products. This might include adding solar panels or wind generators to create your own electricity. You might want to upgrade your current heating and cooling systems to include heat pumps or high efficiency gas heating.

You might also include installing rainwater tanks, waterless composting toilet systems, grey water recycling systems, or other water saving devices.

Regardless of what your energy-efficiency and environmentally-conscious plans are, bankmecu offer a home improvement loan specifically to help cover the initial cost of adding these things to your home.

Keep in mind that in order to qualify for this particular loan, bankmecu may request to see evidence that the home improvements being made are for a sustainable purpose. If your renovations are simply upgrading a kitchen or laying new floor coverings, these may be classified as ‘non-sustainable’, and will be refused.

The biggest benefit to this type of loan is that it’s not added to your mortgage, where it could take you up to 30 years to repay smaller amounts of money. Instead, it’s set up as a separate personal loan specifically for home improvement needs that you can have repaid in just a few years.

Rates and Fees

The current rates and fees applied to this Homebuyer’s Personal home improvement loan are as follows:

Flexible Payment Terms

bankmecu is happy for you to make extra repayments on your loan whenever you have the extra cash. There is no penalty for making extra payments off your loan. You’re able to make your repayments via direct debit from another account, or you can arrange for automatic salary crediting to make your payments the moment you get paid.

goGreen Home Improvement Loan vs Mortgage Top-Up

The vast majority of people assume they need to top up their existing home loan if they want to pay for larger home improvement projects. They also instantly assume that their home loan must automatically be cheaper because the rate is a bit lower.

Yet, what they don’t understand is that adding the cost of these items to such a long term debt, such as a mortgage, can actually end up costing far more in the long term.

Here’s how it works:

Let’s assume you’re going to buy reverse cycle air conditioning, plus solar panels, plus some rainwater tanks for your yard. The total cost comes to $25,000. Let’s look at the difference in total overall cost with a goGreen Home Improvement Loan and topping up a 30 year mortgage.

In the example above, you can clearly see that the mortgage top up option looks cheaper initially. After all, the interest rate is only 6.58% and the monthly repayment is only $159.33. That is usually enough to tempt most people to choose this option.

However, when you consider that the goGreen Home Improvement loan is around $23,048 cheaper in interest charges in the long run, it’s obviously the smarter option financially.

Why pay more than $32,000 in interest charges when you could have repaid that debt decades earlier at a much lower cost?

Overall Verdict

If you’re serious about adding more environmentally sustainable options to your home, but can’t afford the initial cost, the bankmecu goGreen Home Improvement Loan is an excellent choice. The competitive interest rate, coupled with the fact that it’s separated from your mortgage, makes it easier to focus on repaying it quickly.

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The bankmecu Personal Loan features a highly competitive interest rate at 13.49% per annum, which is calculated on a daily basis so that any repayments you make are immediately taken into consideration. This allows you to save money on interest costs while paying down more of the principal so you can pay off your loan as quickly as possible.

The minimum amount you can borrow is $1,000, and the maximum loan term is seven years. This loan also features the easy access all other bankmecu financial products are known for. Thus, as soon as your loan is deposited into your account, you will be able to access the funds securely round the clock thanks to the excellent Internet and Telephone Banking services bankmecu offers.

The bankmecu Personal Loan: What Can I Use It For?

The bankmecu Personal Loan can, essentially, be used for anything you need to finance, including various purchases as well as debt consolidation. Depending on what you are looking to finance, though, make sure you also check out the other loan products available from bankmecu as there might be a better option for your personal circumstances. For example, if you are looking to buy a car, then it’s a good idea to check out the bankmecu Car Loans.

On the other hand, if you are looking to go on holiday, replace furniture or even repaint your home, then the bankmecu Personal Loan is an excellent solution. Just make sure that you really have a good reason to take out a personal loan and you aren’t doing it just for the sake of it because the interest costs do add up in the long run. For example, a $10,000 personal loan at 13.49% interest per annum over five years will end up costing you $3,800 in interest charges alone.

Taking Control of Your Finances with the bankmecu Personal Loan

The bankmecu Personal Loan will help you quickly get on top of your finances and reduce your costs because it can be used to consolidate existing debts you have. This is especially effective when it comes to high interest credit card debt. If you have three credit cards, for example, at an average of 18% per annum interest rate, with an outstanding balance of $15,000 overall, you could save over $2,000 in interest charges if you paid them off in five years. And that’s without including the annual fees and other costs.

Plus, let’s be honest, it will probably take you a lot longer to pay off your credit card debt since most of us tend to stick to minimum payments every month and are usually tempted to max out our credit cards whenever some “emergency” arises. However, by consolidating your credit card debts with a bankmecu Personal Loan, you know you have to pay it off within the maximum seven years. This way you’ll save money and pay off your debts much faster.

Overall Verdict

The bankmecu Personal Loan is the perfect solution for anyone looking for flexible financing, whether they want to go on holiday, make a large purchase or to take control of their financial situation. The competitive interest rate definitely makes it a great choice and will help you become debt free that much faster if used wisely.

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The Share Loan from bankmecu is there to help you out when things go wrong, without costing you the earth.

Overview

• Product type- Personal loan
• Interest rate- 13.24% p.a (14.30% p.a by comparison)
• Annual fee- None

Features and Benefits

• A low rate of interest giving you lower monthly repayments.
• Interest rate is calculated daily so you’ll get an immediate benefit from overpayments.
• 24 hour access to your account via telephone or Internet banking.
• Borrow money for any purpose.

Safer Than Borrowing on Plastic

It can be tempting during times of financial stress to simply use your credit card. The trouble is credit cards are known to be more expensive than personal loans, and failure to repay your debt on time could see a small debt quickly multiply into something far more intimidating.

The bankmecu Share Loan has a small interest rate of just 13.24% pa, making it one of the more affordable personal loans on the market. One of the other big pluses of this product is your interest is calculated daily.

Why’s that of benefit to you?

You’ll make instant savings every time you make an overpayment to your balance. This allows you to pay off the debt much quicker, whilst reducing the amount you’ll repay overall. Being an unsecured loan the money can be borrowed for any purpose, so it doesn’t matter whether you’re facing a financial emergency or treating the family to a well deserved holiday.

How to Apply

You can apply for this product by downloading an application form, or by filling in the online application which is the fastest way to get things moving. Remember any time you apply for a loan the provider will run a credit score on you, so it’s worth checking your credit file for errors before you go through the application.

Pros

• Low variable rate of interest.
• Safer than borrowing on plastic.
• Easy account access.
• Interest calculated daily.

Cons

• To be honest it’s hard to find fault with this personal loan!

This Product Would Suit…

With a low rate of interest, and easy access to your account this is the ideal personal loan for those who want a quick injection of cash. It’s worth noting the interest rate is variable so if rates increase your repayments would follow suit, likewise when rates fall so would your repayments.

Whilst the Share Loan won’t give you enough credit to buy a property, for smaller purchases or help through a “challenging” period it’s almost the perfect product. Remember the easiest way to repay a personal loan early is to make overpayments whenever possible. Not only will you pay off the debt faster, but you’ll also pay back far less in interest than if you let the loan run to term.

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Overview

• Interest rate- 13.74%
• Access- Instant

Features and Benefits

• Low rate of interest.
• Instant access to your money so there’s no waiting around.
• Overdraft can be linked to your Deeming or Access account.
• A secure rolling line of credit.

The Easy Way to Borrow

When you’re strapped for cash you have a number of options credit wise. You can use your credit card, you can apply for a personal loan, or you can access an overdraft facility like the bankmecu overdraft.

Borrowing money from your credit card will cost more in interest, and leaves you exposed to the risk of increased borrowing. A personal loan is more secure in that you can’t spiral into massive debt, however you’ll need to go through a more in depth application process. This won’t help you at all if you need access to money quickly.

An overdraft is a rolling line of credit attached to a bank account. When you need to borrow from it simply use your debit card or withdraw cash as you would normally, and you’ll pay a little interest on what you borrow until it’s repaid.

It’s simple, quick, and limits the amount of debt you’re exposed to. If you’re already a customer of bankmecu you’ll be pleased to know you can link an overdraft to your Access or Deeming account. Just contact customer services or send an email enquiry and they’ll set everything up for you.

How to Apply

If you’re a new customer simply apply online or by downloading a form from the bankmecu website.

Your overdraft will be linked to another bankmecu account so have a look at what’s available and see what suits you best. They provide a wide range of products including current accounts, savings accounts, and deeming accounts so you’re sure to find what you need.

Pros

• Instant access to your money.
• No forms to fill out each time you need to borrow.
• Can be linked to a Deeming or Access account.
• Safer than borrowing from a credit card.

Cons

• Interest rate of 13.74% is slightly higher than the bankmecu personal loan.

This Product Would Suit…

If you need a simple, affordable, and flexible way of borrowing money then a bankmecu overdraft is a sensible choice. Although the interest rate of 13.74% is slightly higher than the company’s personal loan rate of 13.49%, it should be remembered an overdraft is a rolling line of credit. You won’t have to apply every time you want to borrow which makes it much more convenient than a personal loan.

Whilst an overdraft won’t necessarily give you enough credit to make larger purchases like holidays or home improvements, it’s one of the best ways to get your hands on a little extra cash when things get tight before payday.

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bankmecu are willing to reward environmentally-conscious drivers by basing their interest rates on how ‘green’ their car is. If the car you want to buy has very low greenhouse emissions, your interest rate will be set lower accordingly.

This can represent a good discount on an already competitive interest rate. There are also other benefits, offsets and rewards for customers, all designed to keep car loan costs to a minimum.

Rates and Fees

The rates and fees applied to the bankmecu goGreen Car Loan is as follows:

Keep in mind that the definition of a ‘green’ car is an ANCAP rating of 5 stars or a greenhouse rating of 7 or higher. Emissions ratings are taken from the Green Vehicle guide, available from the Department of Climate Change. The car being purchased must be less than 7 years old at time of purchase to be considered a viable collateral asset.

Loan Terms Available

bankmecu will allow customers to extend a car loan out to as long as seven years for a new car, or up to five years for a used car. These extended loan terms can be helpful for reducing monthly payments and keeping cash flow controllable.

Additional Repayments

bankmecu will encourage customers wishing to make extra repayments off their car loan balance. It is possible to nominate that a higher repayment amount be deducted each month as standard instead of just paying the minimum amount due.

You’re also able to set up automatic salary crediting to your car loan account. This is where you nominate to have your salary directly credited to one of your bankmecu accounts. The moment it hits your account, your car loan repayment will be made automatically. This is ideal for those who might have a tendency to forget to make manual payments, or those who simply want to automate the entire payment process.

Quick, Easy Pre-Approval

There’s absolutely no point going shopping for a new car if you’re not sure exactly how much you’re able to borrow. What’s more, you really want to know how much your monthly payments will be before you sign that contract.

bankmecu lets you apply for a quick pre-approval before you purchase. It only takes a short time to apply and you should get your response within a day or two.

Once you’re aware of exactly how much you’re able to afford, you can head out car hunting with confidence. Your pre-approval will last for three months, so this gives you plenty of time to find exactly the right car to suit you.

Young Driver Safety Rebate

In a socially responsible effort to keep young drivers safer on our roads, bankmecu will also reward any young drivers who have successfully completed an Advanced Driver Training course.

A rebate of $200 will be provided to any driver under the age of 25 with a goGreen Car Loan and insurance through bankmecu who can verify completing this driving course.

This is a positive step towards keeping young drivers safer and more aware of controlling their own cars. It’s also great for potentially reducing the number of severe vehicle accidents on our roads.

Overall Verdict

Overall, the bankmecu goGreen Car Loan is a highly socially responsible loan. Rewarding customers for choosing environmentally-conscious cars and for improving driving skills is a great idea. When you add the benefit of a very competitive interest rate, this car loan is an excellent choice.

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Applying for a loan these days mean that you will need to convince the manager that you have the capability to repay the loan and that you are a good customer. Banks are now serious with regards to implementing their “capacity tests” and the customer’s ability to pass all their requirements. No more low-doc loans, lying about income, hiding credit cards and the children if you really want to land in a loan.

Existing borrowers and not only new borrowers need to know about this change in rules. This is because existing borrowers may find themselves not able to borrow as much or refinance as they did in the past. So instead of switching lenders, it is better to stick to your existing provider rather than risking being knocked back by new rules with a new provider. Even long-standing good customers need to furnish everything from Foxtel statements to tax returns if they want to secure a new line of credit, according to bank managers: “It’s embarrassing but bank credit departments have all the power.”

But all these changes in rules does not necessarily mean you will not be able to secure a new loan or refinance any longer. Here are essential tips to follow that will surely help grant you a loan:

1. The Golden Rule

   Remember that in the new banking world, the general rule is this: a single-income couple with a credit card will be allowed to borrow four times their gross income. Most banks will lend up to 80-85 percent of the value of a property but expect a 10-15 percent deposit. In order to make the most out of this rule, make sure that keep your credit history clean.

2. Credit Cards and Children

   Keep in mind that credit cards and your children are big factors when it comes to the calculation of the amount to be borrowed. So be skeptical when deciding whether to apply for multiple credit cards or not. Having kids is never a criminal offense, just make sure that you are being honest when asked about the number of dependents you have.

3. Unpaid Balance

   Do not keep an unpaid balance lurking in your account. According to Libby Koch, she knows of a situation where a customer was able to borrow $710,000 based on his/her annual income (plus assets and security), but when the bank discovered a credit card balance of $20,000, the loan approval was automatically cut to $630,000.

4. Age, Stage, and Credibility

   It is good to know that factors such as age (if you are in your mid-50s, banks expect a retirement in 10-15 years) and current condition like being pregnant affects how you will swiftly land in a loan. In order to keep bank credit departments impressed, make sure to look like a reliable person. Presentation is key and first impressions are crucial. Be honest about your financial position and present a plan on how you are going to pay back the loan.

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However, Jenni Mack, Chairwoman of Choice thinks there is a solution. Sign up for a new adviser or negotiate to end up with the same deal. ”There are 4.3 million people on the books of financial planners,” she said. ”If you’re an existing client, you’ll get told once a year how much you’ve paid – you won’t get the right to opt out, you’ll just get disclosure. We urge existing clients to renegotiate their agreements. And if your adviser won’t put you under the new rules, change advisers. Then you’ll get [to] opt out.”

Hearings concerning changes in the Future Of Financial Advice (FOFA) have been held by a parliament joint committee. A report is expected by month end, months ahead of votes in the Senate and the House of Representatives. The FOFA legislation will make certain financial planners are obligated to act in their client’s best interests. The legislation, if passed, will also prevent them from being paid commissions on financial services and products – fringe benefits from product providers such as overseas trips. The whole objective is so the advice that they will give will not be tarnished by the thought of possible personal gain. They will not be allowed to charge fees on asset-based investments that entail borrowing.

According to Mack, the FOFA changes will face Australia ’s biggest issue regarding financial advice head on – mainly conflicts of interest. ”What we’ve seen in the industry is that it’s been a sales force, not a professional advice service,” she said. "It’s these very conflicts that have caused huge consumer losses in Westpoint, in Timbercorp, in Rewards Group … these were commission-paying products and advisers recommended them because they were getting a big cut from them." Similar to the business model of Storm Financial wherein it was driven by reward structures that paid advisers commissions in every step.

There are concerns though regarding providers finding loopholes or ways around the changes. If compliance will prove to be expensive, fewer independent advisers will also be expected.

”I made a business decision not to be licensed or aligned with any bank or fund manager [but] not many people realize that it’s a lot easier – and cheaper – to simply get a financial planning license granted via a big institution, whether as an employed adviser or even for those advisers who are running their own business,” said Ben Maw, who started his very own practice in North Sydney called BPM Financial. He added that institutions buying up licenses and financial advice companies way ahead of the FOFA introductions is cause for concern.

In addition, for those serious about investing and financial planning, be ready to shell out a substantial amount. While a recent study suggests that the average consumer assumed a financial planner costs only $500, it actually costs around $3000.

”If you want advice with no product pushing [and] no deals, it will cost [you],” Financial Planner Barry Lizmore said.

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The world of financial advice is clearly in desperate need of major restructuring which explains why laws are being thrown around nowadays. The Parliamentary Inquiry into proposed reforms went into effect last week. It included proposals like commissions on investment products being banned and financial planners being required to act in the “Best Interests” of their clients.

The financial planning industry has been functioning under a careless and loose legal requirement that lets advice slip through as “Adequate” since all planners need to do is give “Appropriate” advice. This is the main reason why millions of Aussies are left vulnerable to major losses stemming from fragile advice as seen in the Bridgecorp and Westpoint scandals. Planners promised jaw-dropping returns not because of careful and thorough study of the investment but rather they received gigantic sales commissions.

Although it should not be a controversial legislation due to the fact that biases toward sales of services or products that pay the most commissions is already common and accepted, the financial planning industry is still protesting it. They say a lot of job losses and costly implementation will plague the changes which are disputed by the Financial Ombudsman and Treasury.

The changes are intended to benefit the consumers and their future dealings with financial planners. However, the one change that will benefit present investors is met with the strongest opposition – the requirement for financial planners to send out a financial statement to each and every client with details on how much commission has been paid each year. They claim that commissions and fees are already shown in the initial product disclosure statements. On the other hand, a yearly statement from an adviser will show exactly how much the planner is being paid every year.

Approximately two thirds of financial planning clients do not see their planner on a regular basis, some have never even met them, but are being paid commissions through their work for their clients’ super fund. Whether or not the planner has done anything in the past year to earn it, commissions show up as trail commissions payable every year on different financial products. It is obvious that the industry does not want commissions in the spotlight fearing a lot of opposition.

It is as clear as day that there are a lot of planners who are doing an indifferent, not good enough job most especially when advice determining a client’s financial welfare is concerned. It is high time to end this one-sided culture of demanding fine print, kickbacks and mind-boggling remuneration systems.

A better and fruitful quality advice given at just the right price should be the goal of the financial planning industry. After all, they make money out of their clients’ investments so they owe it to them to give sound and quality financial advice.

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