Low rate personal loansPresented by Jason Beale

March 2016

Introduction - Looking for a personal loan

• Is the interest rate competitive?•What are the fees and charges?• Is there flexibility with loan repayments?•What is the service like?•What are the bank’s values?

Content

•Who is Bank Australia?• The Big Four Banks vs. Bank Australia• Example loan calculation• Benefits of a personal loan from Bank Australia

Who is Bank Australia?

• Operating since 1957

• In 2011 mecu (Members and Education Credit Union)

became Australia's first (and largest) mutual bank

• Mutual banks are customer-owned banks that reinvest their

earnings into better rates and services for their members

Who is Bank Australia?

• In 2011 mecu (Members and Education Credit Union)

became Australia's first (and largest) mutual bank

• Mutual banks are customer-owned banks that reinvest

their earnings into better rates and services for their

members

• In 2015 the bank’s name changed to Bank Australia

• Known for its conservative, responsible approach to

banking

• Committed to values-based business practices that

promote positive environmental, social, and economic

outcomes

The Big Four banks

Personal loaninterest rates

Bank Australia

Personal loaninterest rates

Example loan calculation

• Jack is a hip young

hairdresser with a

steady job who

usually catches the

train to work

• He wants to buy a

motorcycle so he can

ride to work instead

Example loan calculation

• Jack is also

concerned about

the environment

• So he decides to

buy an all electric

Zero FX 5.7

• It sells for $18,990

Loan calculationTo determine the fixed payments and total interest we need

• Amount borrowed (Principal) • Interest rate• Repayment frequency (Weekly, Fortnightly, Monthly)• Length of the loan (Term)• Additional fees and charges

Loan calculationBank of Australia personal loan

• Amount borrowed (Principal) = $18,990• Interest rate = 12.39%• Repayment frequency = Weekly• Length of the loan (Term) = 5 years• Additional fees and charges = no fees

Loan calculationNational Australia BankMonthly fees ($10 p/m over 5 years) 600Interest (26,249-18,990) 7,259TOTAL COST $ 7,859

Bank AustraliaEstablishment fee 150Interest (25,498-18,990) 6,508TOTAL COST $ 6,658 YOU SAVE $ 1,201

Loan calculationNational Australia Bank

Monthly fees ($10 pm over 5 years) 600Interest (26,294-18,990) 7,259 TOTAL COST $ 7,859

Bank Australia (Home Owner Rate)

Establishment fee 150Interest (23,266-18,990) 4,276TOTAL COST $ 4,426 YOU SAVE $ 3,433

Benefits of Bank Australia’s Personal Loan

• Lower interest rates

• No monthly fee

• Discounted rates for home owners

• Flexible repayments

Benefits of Bank Australia’s Personal Loan

• Not-for-profit, customer-owned bank

• Committed to sustainability and community development

• Personal service at six branches across Melbourne

(CBD, Fitzroy, Kew, Mt Waverley, Taylors Lakes, Ringwood)

and at 11 branches across country Victoria

Other things to consider

• Bank Australia has a conservative lending policy

• Be ready for a detailed financial assessment

• And a careful application process

FAQs

• What are the fees and charges?Establishment fee is $150, waived where loan is for sustainable home improvements. No monthly fees.

• What is the minimum loan amount?

$1,000

• What terms are available?

Minimum: 1 year. Maximum: 10 years

• How often can I make repayments?

Weekly, Fortnightly or Monthly

FAQs• Can I make extra repayments?

Yes, plus redraw facility if you are a home owner

• Do I need security for the loan?

Unsecured loans possible up to $20,000 or $30,000

• Is the interest rate fixed or variable?

Variable interest rates apply

• Can I pay out the loan early?

Yes. There is no penalty for early repayment

Question Time

https://bankaust.com.au