St.George Bank was founded in 1937 and was acquired by Westpac in 2008. The bank is funded with retail deposits and wholesale capital market operations. Their loan pricing is independent of Westpac. Their predominant focus is on Sydney and NSW.
St.George home loans are available for first and second homes, investment properties, home construction, renovation, and refinancing. Their family pledge lets you use equity in a family member’s home to maximise your borrowing power, which is particularly useful given the market.
Product and service offerings
- Variable rate home loans with unlimited additional repayments and no break costs for early repayment. You may pause or reduce repayments for a set period, but will end up with higher repayments after the break. Redraw possible.
- Basic no frills home loan has a lower variable interest rate, and no monthly service fees. Establishment fees are waived for those borrowing over $150,000.
- Standard variable rate home loan has a full interest offset and an option to split.
- Fixed rate home loans offer flexible repayment terms with weekly, fortnightly, or monthly payments to suit when your pay comes in. You can lock in fixed rates with a fee and pay interest in advance on investment loans with discounts off the fixed rate. Interest rate discounts and lower fees are available when your credit card, home loan and transaction account are packaged together.
- St.George’s line of credit, called a Portfolio loan, can be a good choice if you are an investor regularly buying and selling property or shares.
What makes St.George home loans different
- Relatively low interest rates on even 95% LVR home loans. Typically you can expect most lenders to offer interest discounts only if you have a 20% deposit.
- Guarantor loans come with favourable interest rates. Family Pledge loans from St.George let first home buyers get a home loan with no deposit when your parents are willing to pledge the equity on their property as security for your loan.
- Can use a gift in place of a deposit if you have been renting (and therefore, have proof you can consistently come up with a monthly payment).
Record on rate cuts
Although there were several rate cuts by the RBA between Jun 2019 and March 2020, there’s no evidence that they have passed on their benefits to customers. However, in March 2021, both WestPac and St.George reduced rates substantially on their loan products across the board making them much more competitive.
To qualify for a home loan you must:
- Be 18 years or older
- Be an Australian or New Zealand permanent resident
- Either married or de-facto (to each other) when making a joint application
Documents you need
To apply for a St.George home loan, you may need:
- Personal ID, such as your passport, driver's license, or Medicare card.
- Statements of your savings accounts for the past three months.
- Two most recent consecutive payslips.
- Self-employed people may be asked for copies of past two years' personal income tax returns and financial statements.
- Owners of rental properties will need a copy of the current tenancy agreements and most recent bank statements showing rent received.
- If you are counting on Centrelink benefits, a letter from Centrelink detailing current entitlements together with a printout of direct credits to verify you have received Centrelink payments.
- Detail of ongoing expenses.
- If you live on rent, your current signed lease rental agreement.
- Other documents to verify assets and liabilities.
Pros and cons
Here are the pros and cons of St.George home loans in comparison with other lenders’ offerings.
- Great interest rates even on small deposits.
- Guarantor loans if you are buying a first home.
- Australian expats and the self-employed are eligible.
- LMI waiver given for first home buyers up to maximum 85% LVR.
- LMI discounts and special rates for preferred professionals including accountants, doctors, engineers and lawyers (subject to income criteria).
- Loans on properties that other lenders may have rejected.
- Refinancing facilities available on all loans.
- Redraw and offset accounts with extra-repayment allowed.
- Repayment holiday subject to approval enabling paused or reduced payments.
- Weekly, fortnightly, or monthly repayments to match your earnings.
- Upfront bank valuations given.
- Lending to trusts.
- Bridging loans.
- Option to split the loan into fixed and variable interest components.
- Construction loans available to owner builders.
- Works with mortgage brokers.
- Considers loans on properties that other lenders may reject.
- Large branch network across Sydney and NSW.
- You can make use of periodic offers of market-leading cashbacks and refinance rebates.
- Free property and suburbs reports give property trends in your suburb or the estimated value of properties you are interested in.
- Expensive LMI when borrowing over 90% LVR.
- Poor choice for those with a bad credit history.
- Predominant focus on NSW customers with little to offer in VIC and SA/NT.
- May be slow in assessing loan applications.
- Do not consider HomeBuilder Grants as funds.