Pro packs

What are Professional Packaged (Pro-Pack) Home Loans?

Professional packages, commonly known as pro packs, are designed by banks and non-banks to give customers a 'one-stop' shop for all their financial needs. They are promoted as lifestyle packages with built-in features such as offset accounts with ATM and internet access, split loans, salary crediting and redraws to provide customers with facilities that are much more than a simple loan.

Advantages of Pro packs

• The savings and benefits you get from professional packages (also known as packaged banking) can be substantial. The most significant benefit is a heavily reduced interest rate. Interest rate discounts generally start at 0.25% and can go up to 0.75% off the standard variable rate, depending on the size of your loan.
• Professional packages may also offer free set up fees, gold credit cards without annual fees, fee-free transactions and savings accounts, and a range of discounts on other banking products.
• Every lender will have different items in their package, with some offering free redraw facilities on 24-hour’s notice, the ability to switch between fixed and variable interest rate and the flexibility in repayments.

Considerations - Pro packs

• Professional packages are structured and branded differently depending on the lender.
• The central component is a home loan, which will need to be over a certain amount to qualify (usually relatively low figure) perhaps around $150,000.
• The banks will allow you to slot their existing fixed or variable loan products into the pro pack and give a discount on the prevailing standard variable rate. Discounts range between 0.1% and 1% depending on the size of the loan - the bigger the loan, the greater the discount.
• You might not get a discount on fixed rate loans, but you will avoid application and establishment fees.
• Non-bank lenders will usually give you a straight rate for that product without incorporating discounts. An annual fee of somewhere between $300 and $400 will be charged and will replace things like credit card fees, transaction and service fees.
• Banks offer a wider selection of financial products than non-bank lenders, so the package is designed to attract as much of the customer’s business as possible, expect higher rates on term deposits, depending on the amount deposited and length of time deposited for.

Pro packs are suitable for

Anyone can apply for a professional package simply by contacting the relevant lender. Most do have some criteria attached surrounding the amount you are borrowing or your annual earnings.