Car loan rates crash to under 5% Peer-to-peer lender RateSetter has dropped its car loan interest rates. RateSetter’s new advertised rates start from 4.69 per cent. Comparison rates depend on term and other loan conditions. RateSetter sets rates according to the credit score of the borrower, with better scores receiving lower rates. RateSetter CEO Daniel Foggo told Broker News the new loan rates will make it easier for consumers to buy second-hand cars. “Harsh economic conditions have stifled consumer appetite for new cars and stimulated hunger for great value. “Consumers are spending less on their automotive purchases and avoiding the price-tags of new cars altogether.” Mortgage brokers face huge fines Mortgage brokers could be fined up to one million dollars if they fail to act in the best interests of their customers. The Morrison government has released draft laws for finance brokers in the wake of the Hayne Royal Commission into financial services. Mortgage brokers, who sell about 60 per cent of all home loans in Australia, will have to comply with a ‘best interests duty.’ Consumer group Choice cautiously welcomed the draft laws with a spokeswoman saying “it should mean you’re more likely to get a better deal.” AMP Bank offering great rates for savers AMP Bank is among a handful of banks that have managed to defy the seasonal outflow of retail deposits in June. AMP is promoting its aggressive pricing of its AMP Saveraccount and some term deposit products, which appear to be winning favour with customers. AMP group CEO Francesco De Ferrari has set ambitious earnings targets for AMP Bank and wants wants to reduce its reliance on wholesale funding. That means AMP will probably continue to offer very competitive interest rates on retail deposit products as it seeks to fund its lending activities. Small business lender Moula has launched Moula Pay, a cross between a buy now pay later service and old-fashioned invoice financing. Moula Pay gives pre-approved businesses the option of purchasing up to $250,000 worth of goods and services. Moula pays the invoice upfront and the business has 12 months to pay, with no repayments or interest calculated for the first three months. Moula chief executive Aris Allegos said more than 40 per cent of businesses take longer than 30 days to pay their bills. “We know how hard it is for Australian businesses to access funding to support day-to-day operations.” AMP Bank gets downgraded – again Global ratings agency Standard & Poor’s has lowered its credit ratings on AMP Bank to “BBB+” from “A-“ and downgraded of the credit rating of the wider AMP group, for the second time this year. S&P has a negative outlook on AMP because of potential fines, legal action, customer remediation and risks associated with the group’s new business strategy. AMP told the ASX that the ratings changes “were not material” for the group. AMP shares hit an all-time low on Monday of $1.64 before recovering on Tuesday to close at $1.66. New Mortgage Broker laws explained The Morrison government has released an exposure draft of the proposed National Consumer Credit Protection Amendment (Mortgage Brokers) Bill, which amends the Credit Act to require brokers to act in the best interests of consumers. The new laws also address conflicted remuneration for brokers and other mortgage intermediaries. The explanatory memo for the bill says the bill requires mortgage brokers to “act in the best interests of consumers.” “They bring the law into line with what consumers expect – that any advice provided by a mortgage broker serves the consumer’s interests first and foremost.” The best interest obligation applies to all loans and credit contract, for example a personal loan or credit card, not just home loans.