RAMS was founded in 1991 as a non-bank lender and bought by Westpac in 2008 during the global financial crisis. RAMS operates on a franchisee model and retains its own credit policy and unique loan offerings distinct from Westpac’s.
It offers home loans for first home buyers, owner-occupiers and investors, ranging from basic, no frill, fixed and variable rate home loans to packaged offerings and full feature loans.
Product offerings
RAMS cater to all kinds of buyers, with useful features to help manage your finances over time.
- RAMS Essential home loan. A straightforward loan with a low variable rate. Suitable for first home buyers, owner-occupiers or investors.
- RAMS fixed rate classic home loan. Suits first home buyers and investors. You choose your fixed rate term - ranging from 1 to 10 years.
- RAMS fixed rate home loan (packaged). For first home buyers and investors. It comes with other features and benefits that are available as part of the Value Advantage Package.
- RAMS Full Feature home loan. For first home buyers, owner-occupiers and refinancers. You have access to a 100% offset account and a redraw facility with this loan.
All of RAMS home loans, both fixed rate and variable, for owner occupiers and investment properties share the following features:
- Minimum loan size $15,000; No maximum specified
- LMI is necessary if borrowing over 80% LVR
- Redraw
- Extra payments
- Loan splitting
- Owner occupier home loans
- 95% maximum LVR on principal and interest
- 95% max LVR on construction loans with interest only of 24 months
- 80% maximum LVR on interest only loan or construction loan with an interest only period greater than 24 months
- Investor loans max LVR
- 90% loans with principal and interest repayments
- 90% loans with interest only repayments and all construction loans
- Payment period: weekly, fortnightly and monthly
- Loan switching on all loans (but terms differ for fixed and variable)
- Repayment holiday
- Deposit bond
- First valuation free
- No early repayment fee
- Discharge fees
- Loan settlement fee
Record on rate cuts
RAMS has a fairly consistent record of passing on Reserve Bank of Australia interest rate cuts to their customers. In June, July and October 2019 and in March 2020, RAMS passed on the RBA rate cuts in full. RAMS didn’t pass on the RBA’s November, 2020 rate cut for its variable home loans but it did introduce new lower rates for its fixed interest loans.
Eligibility
To be eligible for a RAMS home loan you will need to be at least 18 years old and satisfy a number of requirements including:
- 100 point proof of identity checklist;
- Proof of income;
- Details of assets and debts;
- First home buyers must submit their completed First Home Owner Grant application
- Refinancing borrowers need to provide their current home loan details
Pros and cons
Pros
- Minimum loan size of $15,000 with no maximum
- Good choice for first home buyers
- Guarantor loans for first home buyers
- Genuine savings not essential
- Good for self-employed
- Special solutions available for borrowers with poor credit history
- Repayment holiday and additional repayments
- Redraw available on all loans
- Extra payments
- Loan splitting allowed
- Flexible payment period: weekly, fortnightly, or monthly
- Loan switching on all loans (terms differ for fixed and variable)
- First valuation free
- No early repayment fee
Cons
- Application fees on all loans
- LMI over 80% LVR
- Low doc home loans have been discontinued
- Self-employed borrowers need to give proof of income
- RAMS franchisees are mortgage brokers (but they tend to recommend RAMS loan products over those of other lenders)
- Not likely to negotiate on interest rates
- Not competitive on loans over $1 million
- Franchisees work with mortgage brokers; RAMS does not directly deal with brokers
- LMI can be expensive
- No interest capitalisation
- Discharge fees
- Loan settlement fees
