06 Aug “What is the lowest interest rate you can offer?”
One of the most common question we get asked from clients are… “What is the lowest interest rate you can offer?”
At Aspirus Financial Services, we do not just look for the lowest interest rate for our clients, more importantly, we look for the most appropriate loan product across all the different lenders.
The lowest interest rate available might not always be the most suitable or cheapest product for you, taking into consideration the other fees and charges that the lenders charge on top of the interest rate. This brings us to the topic of comparison rate, which is an indicative interest rate that is designed to identify the ‘true cost’ of a loan. The comparison rate takes into account the interest rate and “ascertainable fees and charges” that relate to the loan. However is this a true reflection of the total cost of a product?
Our answer is NO. The comparison rate DOES NOT include fees and charges that may occur or are based on some future “event” – such as redraw fees, early termination fees, progress payments or fees charged by some institutions when you decide to switch lenders.
Finally, it is important to consider all the features and benefits of the loan – rather than just focusing on the interest rate or comparison rate because the rates does not take into account all the factors that should be considered when comparing different loan offers from different lenders.
Benefits such as redraw, 100% offset and ability to make additional repayments / flexible repayment periods are not included within the rates offered by the lenders – but they can make a difference to the attractiveness of a loan.
Please feel free to contact us at [email protected] or 0488 814 148 for a complimentary, no obligation consultation.