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Cairns Lockie Mortgage Commentary

Cairns Lockie Mortgage Commentary

Issue 2000/12 30 June 2000

Welcome to the twelfth issue of the Cairns Lockie Mortgage Commentary for 2000. This is a fortnightly electronic newsletter which aims to keep you informed on developments at Cairns Lockie, Mortgage Bankers and the mortgage market in general. Previous issues of this commentary can be found on our website http://www.emortgage.co.nz

The Money Market

This morning (9 am on 30 June) the money markets were at the following levels:

Official cash rate 6.50% (unchanged from last fortnight)
90 day bill rate 6.90 (down from 6.95)
1 year swap rate 7.23 (down from 7.40)
3 year swap rate 7.38 (down from 7.57)
10 year bond rate 6.76 (down from 6.92)
Kiwi dollar 0.4685 (down from 0.4700)

Cairns Lockie Lowers its Rates Again

We are pleased to announce that we have lowered our three and five-year fixed rates. Our new three year rate is 8.70% (down from 8.75) and our five year rate is 8.79% (down from 8.89). One of the real strengths of an operation such as ours is when wholesale rates decrease we can respond quickly.

Shopping around

Last week AMP Banking released its banking survey. One of their findings was that New Zealanders were reluctant to shop around, for the best mortgage package. When looking for a mortgage, about 50% of respondents said they talked to only one provider of mortgage finance, their exiting bank. Only about 20% said they approached another lender for their comments and assistance. Our advice, is to approach at least three mortgage providers, and one of these must be a non-bank such as Cairns Lockie.

Regular reviewing

The AMP survey also confirmed that few people reviewed their mortgage on a regular basis. Most people took a hands-off approach to mortgage management, only reviewing their mortgages when triggered by events such as significant interest rate changes or when buying and selling a property. Our advice is that your should review your mortgage every two or three years. Financial Planners and Share Brokers are always advising their clients to review their portfolios on a regular basis, we think this should apply to the debt side of your personal balance sheet as well.

Bank Bashing continues

Over the past month there has been three feature articles in the NZ Herald and numerous letters to the editor about poor bank service, branch closures, inexperience staff, excessive fees, mistakes on bank statements and so forth. The same issues are being discussed across the Tasman. The issues raised have so annoyed a group of citizens that an organisation has been launched called "Bankwatch". This organisation plans to monitor the trading banks, and to alert the wider community to unfair banking practices. It will also act as a political lobby group.

Only the Air is Free

The Bank of New Zealand is withdrawing its advertising for Global Plus Free Airpoints following a complaint (to the Advertising Standards Complaints Board) for misleading advertising. The programme operated by providing Airpoints to Gloabal Plus Home Loan customers. What was not disclosed was the $400 application fee and the $50 joining fee. When dealing with banks there are always fees. We understand that The National Bank is has just introduced fees for providing its internet banking services.

20 Ways to Save Money on Your Mortgage

Recently we wrote an article in the Residential Property Investors magazine on 'How to save money on your mortgage'. There was also a similar article published in the April edition of the Consumers magazine. Following requests from customers interested in this subject, we have expanded the article and it will be available on our website (http://www.emortgage.co.nz) from next week.

Our current interest rates are as follows

Variable rate 8.35% Two-year fixed rate 8.55 (down) Three-year fixed rate 8.70 (down) Five-year fixed rate 8.79 (down) Line of credit facility 8.70

Regards William Cairns James Lockie

Cairns Lockie Limited PO Box 74-212, Market Road, Auckland Telephone (09) 525 9711 Facsimile (09) 579 7795 Website http://www.emortgage.co.nz Email mailto:wcairns@emortgage.co.nz mailto:jlockie@emortgage.co.nz mailto:gslade@emortgage.co.nz mailto:sgasson@emortgage.co.nz mailto:plange@emortgage.co.nz

If you know anyone who may find this newsletter useful we would be happy for you to forward it on.


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