Get a Better Deal from your Bank

0829 Sooner Solutions logo email and webWhen clients ask me about getting a better deal on their mortgage rate, I advise them about what is achievable from others and suggest that they give their bank a subtle ultimatum, in which the underlying message is, “Match the current market rate for my situation or I’m leaving.”  While I’m happy to make it as painless as possible to switch banks, far less time and effort is required by ‘demanding’ that your bank do the right thing and reward your loyalty.

I, too, was among the vast majority that expect their bank to ‘look after me’ as rates fall.  But, the headline rates are only the starting point, because good brokers know that securing the best available discount (sometimes well over 1%) to the standard variable rate is the real objective.  Don’t expect your local bank branch office to ring you when available discounts are increased, because branch personnel have incentives to withhold discounts.  That’s where the ‘demand’ can sometimes yield the desired result, but only if your branch can’t afford to lose you.  But, there’s an even better way.

The most powerful department in most banks is the one responsible for client retention.  So, ring me to learn what is reasonable to expect, then find the Retention Department in your bank to request an increased discount.  If they refuse, I’ll help you switch.

Interest Rate Trends

Sooner Solutions logo EMAILI’ve been recording certain interest rates on a weekly basis for several years, and it’s interesting to note that, for the first time in decades, the five-year swap rate fell to under 3%.  (For the uninitiated, the swap rate is the rate at which banks will lend to each other.)

The significance for those who need Medical Equipment Finance or any other form of Asset Finance is that you should be able to secure a five-year loan at close to 5% (assuming that lenders need ~200 basis points for margin and risk).

Also for the first time, the best three-year and five-year term deposits are in ‘lock-step’ at 4.2%.

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