Refer to the “notepad” section in the client’s mercury file for loan structure, lenders and details needed to lodge pricing
When lodging pricing requests, we always use a competitor bank to attempt for better pricing. If it’s a ‘big 4 (CBA/NAB/ANZ/Westpac)’ make sure we add another ‘big 4’ bank to compare, but be careful not to use a lender that isn’t in the pricing request. With a variable product, you can usually enter a discount request of 3.5%.
Most banks are instant pricing, so we always escalate the pricing at first and add necessary escalation notes (i.e. other lender providing….., genuine retention risk….etc to try to better the rate)
Once the escalated pricing is back, unless we know that client has already chosen a lender based on other requirements and unless pricing cannot be done with any specific lender, always escalate to BDM providing a competitor rate.
Complete new product comparison in clients mercury file using the products from the pricing request. Update the rates once pricing requests are confirmed. Be careful you select the correct package and product
Some banks do not do pricing (ING, Macquarie, AMP etc) so we will have to find out their interest rates by looking through the bank’s broker website. You can find the broker website details on the lender spreadsheet. Be careful with these banks as they usually provide rates based on LVRs, loan amounts etc.
Make sure you tick the “interest only” box for each IO loan. Always ensure that you amend the ‘roll to’ P&I rates for when they revert after the IO period. To keep the P&I rate, use the P&I advertised rate minus the discount received for IO loan. This will give you the final rate. However, while entering in PC, you will have to increase the discount to get the final rate that you got above.
Example: IO advertised rate is 9.34% and the discount we got was 2.56% - Final IO rate = 9.34% - 2.56% = 6.78%
To get P&I rate, look for P&I advertised rate suppose: 9.04% (from website) minus the discount we got above 2.56% - Final P&I rate = 9.04% - 2.56% = 6.48%.
However, you will not be able to change the advertised rate in PC. So what we do here is take the IO advertised rate of 9.34% and subtract the final P&I rate = 9.34% - 6.48% = 2.86% discount (this should be entered in the PC P&I section discount so we get the final rate of 6.48%
i.e., Final P&I rate = 9.34% - 2.86% = 6.48%