Banks and lenders usually offer staff discounts on their loan packages. These can range from interest rate discounts to the waiving of Lenders Mortgage Insurance (LMI).
However, better offers can often be found outside the staff benefits scheme, sometimes at another bank, or even at the company where you already work.
How Much Can I Borrow?
- 90% waived LMI: Some major banks waive the cost of mortgage insurance when you borrow up to 90% of the property value. LMI usually kicks in at 80%, so it’s usually worthwhile applying through your bank.
- Interest rate discounts: If you’re borrowing under 80% of the property value or don’t have waived LMI, you can get a better deal from another bank.
We also have a lot of negotiating power with the 50-plus lenders on our panel. You can call us on 1300 889 743 or enquire for free online, and one of our specialist brokers will talk to you about what the other banks have on offer.
Why don’t banks give great discounts to their staff?
Surely it’s worthwhile for banks to give their staff great discounts? It turns out that it isn’t that simple.
- Fringe Benefits Tax (FBT): A discount for staff members could be subject to FBT so that the employer may be taxed on the discount.
- Competiton rules: A discount offered to staff may need to be offered to the wider market to comply with various regulations.
- Bank employee rate discount varies from lender to lender, ranging from 0.5% to 1% off the Standard Variable Rate. They also offer cheaper rates on their credit cards, but, again, it’s not very large at all.
For this reason banks do give discounts to their staff, yet they are rarely any better than they offer to the general public.
We Can Usually Get You A Better Deal!
While bank staff used to receive large discounts on mortgage interest rates, many of the perks for bank staff have been cut back in recent years.
These days, the discounts that banks offer their staff are limited to lowering fees or small interest rate discounts.
Waived LMI discounts are great so you should consider them.
At the end of the day though, you can usually achieve the same result with a guarantor home loan and get a better interest rate from another lender.
Am I Eligible For A Bank Employee Home Loan?
Generally speaking, you need to meet the following requirements:
- Working full time.
- Past probation or a minimum of 12 months in your role.
Why Are Better Deals Available Elsewhere?
Banks such as ANZ, Commonwealth (CBA), St George and Westpac, among others, are usually not willing to offer their staff higher discounts than those that they give to the general public.
If the lender that you work for doesn’t have competitive products already, then in most cases, their staff discount won’t be competitive either.
The banks will never offer you a product from another competing company. A mortgage broker, however, works with many different banks and lenders, including the bank that you work for, and will be able to tell you if you’re getting a good deal or not
How Can A Mortgage Broker Find A Better Deal?
While the banks may give staff discounts on their products, brokers can offer deals from all the lenders they work with. This gives them a greater range of products to choose from, and therefore a better chance of not only finding great deals, but also the most suitable product for your needs.
Some mortgage broking companies also have special partnerships with lenders.
In some cases, they will be able to offer their clients better deals from those lenders than would otherwise be available.
In a few cases, we’ve been able to get bank staff better deals from their employer than they could get on their own.
To find out more enquire online, or call us on 1300 889 743.
How Do I Know Where To Apply?
You can research online or go from bank to bank, asking them what they can offer, but it might be easier to call an experienced mortgage broker whose job is to know the lending policies of different banks and lenders.
Every time you apply for a loan with a lender, a record goes on your credit file. Getting a loan declined will lower your credit score, making it difficult to get your next application approved.
A mortgage broker removes most of this risk by assessing your situation BEFORE applying. We won’t apply with a lender who can’t consider your situation, so you can be confident that your credit history will stay intact.
Why Should I Apply With Another Lender?
There are many reasons why bank employees choose to apply with another lender for their home loan. These can include
- Privacy: Other staff may be able to see your details in the bank system. While banks have strict rules about privacy, they aren’t always followed.
- Leaving the bank: In some cases, staff discounts are cancelled if you change your employment. For this reason, many contractors choose to apply with other lenders.
- Lending policy: In most cases, the banks will still not make exceptions to their employee lending policy. It makes sense to apply with a bank that caters to someone in your situation.
Find out how home loans for bank employees work so you can make an informed decision.
Apply Through A Mortgage Broker Today!
Home Loan Experts is dedicated to finding our clients the home loan that works best for their needs.
We can pick and choose products from over 50 different banks and lenders, often finding bank employees with better mortgage deals.
Are you looking for a home loan and are employed at a bank or lender?
We can help!
Contact us today, and one of our specialist brokers will help you find the best home loan available from our panel.
Call 1300 889 743 or enquire online.