Westpac is one of the major banks in Australia that provides a range of investment loan products to customers. Investment loans allow investors to leverage their existing assets to invest in additional properties or financial assets. Westpac offers both variable and fixed investment loan rates, with discounts available based on loan size and package deals. Understanding Westpac’s investment loan rates can help investors find the most suitable and cost-effective loan product for their needs. This article will analyze key information and conclusions about Westpac investment loan rates, including rate discounts, fixed vs variable rates, and how Westpac compares to other major banks.
Westpac provides tiered discounts on investment loan rates based on loan size
Westpac offers tiered interest rate discounts on its investment loans based on the loan amount. For example, for loans under $250k, there is a 0.10% discount off the advertised variable rate. The discounts increase up to 0.90% off for loans above $1 million. This incentives larger investors to borrow more from Westpac. Fixed rates also have discounts, but less than variable rates. By packaging multiple lending products, further discounts are available via Westpac’s Wealth Package for loans over $250k. So for larger investors, Westpac’s advertised rates are just the starting point, with progressively larger discounts available on bigger loans.
Westpac investment loan fixed rates have lower discounts but provide certainty
While Westpac’s variable investment loan rates offer the biggest discounts, fixed rate loans provide certainty around repayments. Westpac offers fixed terms from 1 to 5 years. The fixed rates are set higher than variable rates, but still have tiered discounts. For example, the current 1 year fixed investment loan rate has tiers from 4.79% down to 3.99% for over $1m loans. The equivalent variable rate would be 4.04% discounted down to 3.14%. So there is a tradeoff – fixed rates mean the repayment is locked in, while variable rates can fall if the RBA cash rate drops. Investors will choose fixed rates if they want repayment certainty or expect rates to rise, while variable rates offer potential savings if rates decline.
Westpac investment loan rates comparable to other major banks after discounts
While headline rates may differ between the major banks, after tiered discounts are factored in, their investment loan rates are broadly comparable. For example, NAB advertises a 4.19% variable rate and ANZ 4.09%, vs Westpac’s 4.04%. But for a $500k loan, NAB discounts to 3.69%, ANZ to 3.59%, and Westpac to 3.54% due to its tiered pricing. Westpac also allows very high loan-to-value ratios of up to 90% for investment property purchases, in line with other banks. Each lender has its own specific product features, so investors should compare discounted rates and LVRs across banks to find the most suitable option.
Package deals can further reduce Westpac investment loan rates
By taking out multiple products and services, Westpac customers can obtain further discounts on their investment loan rate via package deals. For example, the Wealth Package provides discounts when customers have a transaction account, credit card and loans with Westpac. There are tiered packages based on minimum loan sizes, with higher discounts for higher tiers. This incentivizes customers to hold more products with Westpac. Investors could potentially save 0.40-0.80% off their investment loan rate by packaging, making Westpac more competitive. However, customers need to compare any annual package fees against the savings.
Westpac provides tiered variable and fixed investment loan rates, with sizeable discounts available for larger loans. After discounts, its rates are comparable to other major banks. Additional savings are available by packaging multiple products to access package discounts. By understanding the tiered pricing and potential discounts, investors can find competitive Westpac investment loan rates for their needs.