Trending Financial News 9 October
ANZ to pay more compo to customers
ANZ Bank will pay remediation costs of $559 million to customers who have been charged fees wrongly on home loans, savings accounts and financial advice over the last ten years.
The bank reported to the Hayne Royal Commission into Financial Services that it would need to compensate two million customers. ANZ has already provisioned $928 million for customer compensation.
ANZ’s chief financial officer Michelle Jablko said the bank has “a dedicated team of more than 500 specialists working hard to get any money owed back to customers.”
Bad News for Savers
Commonwealth Bank has cut the Netbank savings account base rate by 0.05 percentage points, to 0.1 per cent.
All of the big four bank’s flexible savings accounts’ base rates are now between just 0.1 and 0.15 per cent.
“It’s bad news for savers,” said AMP senior economist Shane Oliver.
“We already have record-low rates on deposits and now they are going to be even lower.
Term deposit rates are slightly higher than at-call savings account rates, on average, but trending down.
“We are looking at term deposit rates around 1.5 per cent at present and we will be heading down towards 1 per cent before you know it,” Dr Oliver told the Herald Sun.
Compare term deposit rates at InfoChoice.
Credit scores more important than ever
Banks and other lenders have more information on loan applicants than ever before and this feeds into their loan application decisions. Credit scores are usually between zero and 1000 or zero and 1200, depending on which credit score service you use.
Experts warn banks are not likely to lend to someone with a score under 650.
There are three main credit reference bureaus in Australia – Equifax (getcreditscore.com.au), Experian (creditsavvy.com.au) and illion (creditsimple.com.au).
MoneyPlace’s chief executive, Stuart Stoyan, told the Herald Sun that consumers need to know what’s in their credit report.
“It is absolutely something you should care about.”
“It shows whether or not you are making your repayments on time and if you are missing a repayment and how many repayments have you missed.”
Which lender has the lowest home loan rates?
The lowest variable rate (OO, P&I) now listed by InfoChoice is 2.69 per cent pa (comparison rate 2.71 per cent pa).
The lowest fixed rate home loan (OO, P&I) rate is 2.74 per cent pa (comparison rate 2.94 per cent pa for 3y loan).
Auction clearance rates dip in October
CoreLogic reported 1,324 homes were put up for auction in Australian capital cities on Saturday 5 October, up from 1,278 the previous week. The final clearance rate is expected to be revised down to under 70 per cent, down from 71 per cent last week.
The market has been affected over the last two weeks by football grand finals in Sydney and Melbourne.
Sydney and Melbourne clearance rates continue to be stronger than other capital cities.
On the same weekend last year, clearance rates were around the 50 per cent mark.