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Peer-to-peer lender RateSetter has announced that it has dropped rates on new car loans by 85 basis points, following consultation with brokers.
Effective immediately, loans for new cars and demonstration models will start from 4.95 per cent - a drop of 85 basis from its previous headline rate of 5.80 per cent.
The loans are available for new and demonstration cars and range between $5,000 and $100,000*.
According to the non-bank lender, the move comes following “a period of extensive consultation with RateSetter’s network of more than 2,000 accredited car loan brokers”.
It said that the new car loan rates help “creditworthy borrowers get on the road for less and provide brokers an important competitive edge against traditional lenders and dealership finance”.
New rates
| New car/demo | 0 to 3-year-old car | 4 to 7-year-old car | |
| Tier 1 | 4.95% | 5.45% | 6.45% |
| Tier 2 | 5.95% | 6.95% | 7.95% |
| Tier 3 | 8.95% | 9.95% | 10.95% |
Note: Borrower tier is determined by client profile, including credit history, home ownership status and employment status. Add 0.5 per cent for seven-year loan term
The rate changes come after RateSetter rolled out a series of other updates to the product, including:
- A simplified and broadened credit policy to “attract more borrowers with an expanded loan size range”, new overrides policy and increased loan-to-value ratio calculation;
- A streamlined online application journey featuring real-time servicing, application status and remittance alerts as well as “timely document verification”; and
- Updates to the broker portal that gives brokers access to “quick quoting tools and calculators”, as well as the ability to track in-progress applications, commissions and lodge and amend applications.
Speaking of the change, RateSetter CEO Daniel Foggo said, “Brokers love our technology and our focus on delivering value to customers. We’ve dramatically lowered rates and upgraded our online experience because we know it’ll drive growth and retention for our broker network.”
He continued: “Nothing is more persuasive than an industry-leading rate. We give brokers access to the credibility of an award-winning brand and the kind of value that will endear brokers to their clients time and time again.”
Mr Foggo added that RateSetter was “a true alternative” to traditional bank consumer loans because it is “flexible, efficient and, above all, in touch with broker needs”.
“Our dedicated, national sales team has worked hard to engage brokers and align our car loan product with their needs. They will continue to educate, assist and connect brokers throughout their lifecycle with competitive finance and an outstanding client experience,” he concluded.
*The loan range was updated on 24/06/2019 to reflect the new range as listed on RateSetter's website.
[Related: Peer-to-peer lender joins Vow Financial’s panel]
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