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Margin Loans Margin loan rate increase

Discussion in 'Finance & Banking' started by Smartypants, 17th Nov, 2007.

  1. Smartypants

    Smartypants Well-Known Member

    Joined:
    2nd Jun, 2006
    Posts:
    226
    Location:
    NSW
    With the recent rate increase I was obviously expecting all of my loans to be increased by .25 of a percent but was informed my BT margin loan is incresing by .45 of a percent taking it up to 9.65%.

    Starting to get expensive, just hope we don't have too many negative return quarters in the foreseeable future.

    Has anyone else had notification from their margin lenders of such an increase. Bit cheeky I reckon.

    My margin loan is not massive (approx 250K) and I don't capitalise interest, i.e with each quarterly (Navra) distribution I generally deposit the last 3 months worth of interest back into the loan. As well as this I try to reduce the loan here and there with any extra cashflow.

    Anyway, just venting my frustration with BT.

    As an afterthought, as BT are affiliated with Westpac, would there be any consideration on their part (BT) to a reduced rate as I have considerable loans through Westpac?
     
  2. FrankGrimes

    FrankGrimes Well-Known Member

    Joined:
    9th Jun, 2006
    Posts:
    110
    Location:
    Sydney, NSW
    I noticed the same thing.. Very cheeky!

    BT don't seem to budge on rates, I've noticed other people on the forums have negotiated better rates but BT doesn't care.. I have 900k in Westpac loans as well

    So let me know how you go
     
  3. Dr Lobster

    Dr Lobster Well-Known Member

    Joined:
    12th Jun, 2006
    Posts:
    95
    Location:
    sydney nsw
    I look at my mgd funds and IPs as a job lot.

    I capitalise my interest on the margin loans, and take the distribution and spend it. Sure my LVR on my ML is increasing, however my IP LVR is decreasing to the point where my overall LVR is decreasing.

    Capitalising the interest on my Margin loans means ultimately I am spending some of my equity, however my equity is increasing, and I am confident that it will increase enough in my required timeframe to make full time work an option.

    So I am trying to enjoy myself along the way.

    Therefore while I don't enjoy the rate rises I try not to sweat it either.
     
  4. Sean

    Sean Member

    Joined:
    23rd Aug, 2005
    Posts:
    24
    I've noticed Rams have been increasing their rate by 0.3% instead of matching the 0.25% RBA increase. They have also thrown in an added rate rise. I am not a happy customer, I rang and advised I will be refinancing to try and prompt them to offer me a better deal, but the care factor was pretty low and they showed little concern. I will be ditching them as soon as possible.
     
  5. willy1111

    willy1111 Well-Known Member

    Joined:
    5th Jul, 2006
    Posts:
    54
    Location:
    Melbourne
    There is talk around that some of the majors may also do this Sean, so maybe hang on to your hat for a little bit and see how it pans out.

    Wouldn't want to be paying a penalty to get out of RAMS and go somewhere else to find they do the same thing.

    Assuming your only reason for changing is to get a better rate of course.
     
  6. DaveA

    DaveA Well-Known Member

    Joined:
    19th Feb, 2007
    Posts:
    617
    Location:
    Sydney, NSW
    While not huge, my rate with the cba went from 7.62 to 7.89 in the last rise, so thats .28 instead of .25. Not a huge concern however just proves that its effecting everyone.
     
  7. crc_error

    crc_error The Rule of 72

    Joined:
    1st May, 2007
    Posts:
    1,367
    Location:
    Melbourne, VIC
    I'm with comsec and they raised their rates by 25 pts.. however I called them and negotiated a 25 pt discount! so currently I'm paying 9.25%..

    I'm considering fixing my rate for 9.25 with comsec for 5 years.. payable in arrears.
     
  8. Rod_WA

    Rod_WA Well-Known Member

    Joined:
    18th May, 2007
    Posts:
    324
    Location:
    Inglewood, WA
    Macquarie Prime are at 9.2% after the rate rise but before discounts, one of which is a 0.2% discount for refinancing from another ML provider, so that's 9.0%. I'm beginning to come around to this product; I'm planning to sit down with the PDS in the next few days.
     
  9. FrankGrimes

    FrankGrimes Well-Known Member

    Joined:
    9th Jun, 2006
    Posts:
    110
    Location:
    Sydney, NSW
    I'm on Prime now - I have some gripes but the rates are good. Perhaps start a thread and I'll add to it.
     
  10. Rod_WA

    Rod_WA Well-Known Member

    Joined:
    18th May, 2007
    Posts:
    324
    Location:
    Inglewood, WA