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BFCSA investigates fraud involving lenders, spruikers and financial planners worldwide.  Full Doc, Low Doc, No Doc loans, Lines of Credit and Buffer loans appear to be normal profit making financial products, however, these loans are set to implode within seven years.  For the past two decades, Ms Brailey, President of BFCSA (Inc), has been a tireless campaigner, championing the cause of older and low income people around the Globe who have fallen victim to banking and finance scams.  She has found that people of all ages are being targeted by Bankers offering faulty lending products. BFCSA warn that anyone who has signed up for one of these financial products, is in grave danger of losing their home.

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BFCSA: Savers rates fall eight times more than mortgages

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Savers rates fall eight times more than mortgages

Australian Financial Review Apr 17, 2019 5.03pm

Duncan Hughes

 

Interest rates for popular online savings accounts have fallen eight times more than rates for standard variable mortgage borrowers, forcing savers to shop around for higher interest or seek more riskier options, such as equities.

It is likely to get even worse for savers, many of whom are retirees, if the Reserve Bank realises market expectations and continues to cut the cash rate, which are already at a record low 1.5 per cent.

“Savers can no longer put their money into an account and forget about it,” said Steve Mickenbecker, group executive of Canstar, which monitors rates and fees for financial products. “Now is the time to manage savings, or put up with low returns.”

Rates on flexible savers, online savers, bonus accounts and terms deposits are all being trimmed by authorised deposit takers who are no longer as reliant on depositor savings to fund their lending.

For example, rates on term deposits ranging from one month to five years are falling by up to 17 basis points, or more than 6 per cent off the average rate, according to Canstar, which provided the rates.

The cuts are more than three times the headline inflation rate of 1.9 per cent.

Top rates paid on a one-year saving account with a deposit of $25,000 is about 2.85 per cent and the lowest is 1.3 per cent following recent cuts of about 10 basis points.

For shorter fixed terms of one month the minimum rate is 1 per cent and highest about 2.12 per cent.

Some bonus savers accounts with minimum deposits of $10,000 are paying zero interest with the maximum a below-inflation 1.8 per cent.

Others, such as Newcastle Permanent Building Society, are dropping their base rate by 25 basis points to 0.85 per cent and launching a three-month promotional rate of 1.95 per cent. At the end of the term it reverts back to the base rate.

Many bonus and promotional accounts include a range of strict conditions from making a minimum monthly deposit and no (or very few) withdrawals to having a linked transaction account with the same bank or credit union or setting up an automatic savings plan with a regular debit from a linked transaction account.

Bigger deposits are attracting higher rates. Bank of Queensland is paying up to 3 per cent for deposits up to $250,000 while CUA is offering 2.9 per cent for accounts up to $750,000.

Online accounts have been the hardest hit. Since the last cash rate cut in 2016 the spread between the standard variable rate and online cash rates have continued to widen by 33 basis points. Over the same period the margin between the cash rate and standard variable rate increased 0.4 per cent.

 

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