New poll shows we pay too much credit card interest

Heritage Bank CEO John Minz today urged local residents to check their credit card deal after new research revealed many Australians didn’t know the interest rate they were paying over Christmas.

An Essential Research poll on Christmas shopping habits showed Australians use credit cards to buy Christmas presents but few people know what the interest rate is.

The report commissioned by the Customer Owned Banking Association found Australian consumers could have avoided a big credit card bill by finding out more about the better rates available.

“Surprisingly, the research shows that a lot of people are unsure about the best deals and the current interest rates they pay,” Mr Minz said.

“We don’t want our customers forking out for excessively high credit card rates and paying more than they need to.

“As a mutual bank, Heritage Bank is owned by our customers. Our profits stay within the business and are returned to our customers through competitive rates and fair fees and charges.

“We offer great value through our products and were named as the winner for Cheapest Credit Card – Bank (Gold Low Rate) and Business Credit Card - Bank (Visa Business Unsecured) in Money Magazine’s 2014 Best of the Best Awards.”

The Essential Research poll of 1000 people, commissioned by COBA found:

• Australians buy 7 Christmas presents and spend $570 on average;
• More than a third describe paying for Christmas presents as “stressful”;
• 65% don’t know who has the lowest credit card interest rates;
• Around half said “Don’t know” when asked the current rate they pay.

The research found a significant proportion of younger Australians wrongly think the big four banks offer the best rates - 16% of people aged 18-34 nominated the big 4 banks compared to just 7% of those aged 55 and over. 

“Customer-owned financial institutions like Heritage Bank offer competitive deals on home loans, personal loans and credit cards, so there’s simply no reason to pay high interest rates,” Mr Minz said.

“There are so many different options available so it’s important for people to shop around to compare the rates, products and customer service on offer to find the best option for their particular circumstances.”

“A little research goes a long way and could help you save a lot of money down the track."

 

* Home loan comparison rate based on a $150,000 loan over 25 years.  Fixed loan comparison rate applies only for loans with an LVR of 80% or less and a loan amount of $150,000 to $249,999.  WARNING: This comparison rate is true only for the examples given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate.

Interest rates are on a per annum basis. Rates are correct as stated and subject to change without notice. Rates shown are for new loans and do not apply to switches or internal refinances.

Home Advantage Variable rates include discounts shown from the Standard Variable rate. Home Advantage Living Equity rates include discounts from the Living Equity rate. Discounts are based on total lending in the package. Discount Variable LVR rates are for new lending and include discounts from the Discount Variable Loan Rate.  Discounts are not available in conjunction with any other interest rate discount or special offer. All fixed rates are fixed for the period stated and revert to the variable rate applying at expiration of the fixed term. To approved applicants only. Conditions, criteria and fees apply.

Loan to Value Ratio (LVR) is the loan amount divided by the value of your security property (determined by Heritage Bank at assessment), multiplied by 100. Owner Occupied loans have a maximum LVR of 95%, Investment loans have a maximum LVR of 80% and Living Equity has a maximum LVR of 80%. Heritage is not accepting any new investment applications until further notice.

This advice has been prepared without taking into account your objectives, financial situation or needs. Because of this you should, before acting on this information, consider its appropriateness having regard to your objectives, financial situation or needs.

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