86 400 launches all-digital home loans

author-avatar By on November 12, 2019
86 400 launches all-digital home loans

Image supplied by 86 400

86 400 has today unveiled Australia’s first-ever digital home loan through brokers, allowing Aussies to get approved for a mortgage up to six times faster than the big four.

The loans are only available through mortgage brokers, facilitated through 86 400’s platform.

The fully digitised home loan process means brokers will be able to process loan applications faster than they have before, according to 86 400 Home Loans Lead Melissa Christy.

“We’re aiming for six times faster than the average of the big four banks, so customers will know within 24 hours if they’ve been approved,” Ms Christy told Savings.com.au.

86 400 home loans

Despite being a new bank, 86 400 have a broad range of home loans on offer:

  • There are loans for investors, refinancers, purchasers and owner-occupiers
  • Each of these loans have fixed and variable rate options, both with redraw facilities
  • Those who opt for a variable rate will be able to link to multiple offset accounts (both 86 400 Pay and Save accounts)
  • Fixed interest rates start at 2.88% p.a. and variable interest rates start from 3.09% p.a. (comparison rates differ, see 86 400’s website for a full list of rates)
  • There are interest-only (IO) as well as principal and interest (P&I)

How 86 400’s home loan application process works

Robert Bell, CEO of 86 400 said the neobank has spent eighteen months working through the key pain points for customers and brokers before developing smart technology solutions.

“We set out to create an entirely new, smarter approach to the home loans application and through technological innovation and collaboration with equally innovative partners we’ve done just that,” Mr Bell said.

The digital bank has partnered with an array of companies to speed up the mortgage application process, including CoreLogic, Equifax, MaxID, FMS, Loanworks, Simpology and Mogoplus.

Ms Christy said they’re able to achieve faster mortgage application times by replacing paperwork with digital verification of identification, income and expenses.

“Once applicants have met with their broker, they electronically provide their income and expenses. This data is categorised, verified by the applicants and automatically populated into the application. This happens in minutes and saves the applicant the lengthy process of having to manually pull this information or provide paper documents,” Ms Christy told Savings.com.au.

86400 statements

Source: 86 400

“Applicants also go through identity verification on their mobile and sign their loan documents electronically. By using smart technology we are able to get a very accurate picture of the applicants’ financial position upfront and save time and effort for both the applicant and the broker along the way.”

Rather than having to submit physical documents, smart technology means applicants are only required to submit a contract of sale for purchases, and no documents are needed to refinance. Borrowers will also benefit from electronic statement capture, electronic signatures, and simplified identity verification on your mobile.

86 400 is also partnering up with two mortgage aggregators, Vow Financial and Specialist Financial Group. Together, that equates to 2,800 mortgage brokers in Australia offering home loans from 86 400 as of today.

While 86 400 isn’t the first lender to offer digital home loans (Tic:Toc and Athena currently offer online home loans) 86 400’s offering is unique in that it’s partnering with mortgage brokers.

While not ruling out the possibility of offering home loans directly to customers down the track, Ms Christy said many borrowers apply for their mortgage through a broker.

“We are progressively rolling out with selected brokers, as brokers currently make up almost 60% of all home loan processes in Australia. They also provide the customer with important face-to-face contact for such a big financial decision and can assist the customer to find the best lender and best product to suit their specific circumstances,” Ms Christy said.

“We know mortgage brokers drive competition and choice for consumers, which is why we have focused on erasing their pain points so they can deliver the best value to customers. This is the first offering in recent years that offers real, tangible benefits to both brokers and homebuyers.”

Below are some of the lowest home loan rates on offer across the big four banks, customer-owned banks and larger non-banks.

Lender
Advertised rate Comparison rate Monthly repayment Rate TypeOffsetRedrawOngoing FeeUpfront FeesLVRLump Sum RepaymentAdditional RepaymentsPre-approval
VariableMore details
LIMITED TIME OFFER

Smart Booster Home Loan Discounted Variable - 2yr (LVR < 80%)

  • Fast turnaround times, can meet 30-day settlement
  • For purchase and refinance, min 20% deposit
  • No ongoing or monthly fees, add offset for 0.10%
LIMITED TIME OFFER

Smart Booster Home Loan Discounted Variable - 2yr (LVR < 80%)

  • Fast turnaround times, can meet 30-day settlement
  • For purchase and refinance, min 20% deposit
  • No ongoing or monthly fees, add offset for 0.10%
VariableMore details
AN EASY ONLINE APPLICATION

Yard Home Loan (Principal and Interest) (Special) (LVR < 70%)

  • Unlimited additional repayments
  • Unlimited free redraws
  • Optional 100% offset can be added for $120 p.a.^
AN EASY ONLINE APPLICATION

Yard Home Loan (Principal and Interest) (Special) (LVR < 70%)

  • Unlimited additional repayments
  • Unlimited free redraws
  • Optional 100% offset can be added for $120 p.a.^
FixedMore details
NO UPFRONT OR ONGOING FEES

Basic Home Loan Fixed (Principal and Interest) (LVR < 70%) 3 Years

NO UPFRONT OR ONGOING FEES

Base criteria of: a $400,000 loan amount, variable, fixed, principal and interest (P&I) home loans with an LVR (loan-to-value) ratio of at least 80%. However, the ‘Compare Home Loans’ table allows for calculations to made on variables as selected and input by the user. All products will list the LVR with the product and rate which are clearly published on the Product Provider’s web site. Monthly repayments, once the base criteria are altered by the user, will be based on the selected products’ advertised rates and determined by the loan amount, repayment type, loan term and LVR as input by the user/you. Rates correct as of October 18, 2021. View disclaimer.


Disclaimers

The entire market was not considered in selecting the above products. Rather, a cut-down portion of the market has been considered which includes retail products from at least the big four banks, the top 10 customer-owned institutions and Australia’s larger non-banks:

  • The big four banks are: ANZ, CBA, NAB and Westpac
  • The top 10 customer-owned Institutions are the ten largest mutual banks, credit unions and building societies in Australia, ranked by assets under management in November 2020. They are (in descending order): Great Southern Bank, Newcastle Permanent, Heritage Bank, Peoples’ Choice Credit Union, Teachers Mutual Bank, Greater Bank, IMB Bank, Beyond Bank, Bank Australia and P&N Bank.
  • The larger non-bank lenders are those who (in 2020) has more than $9 billion in Australian funded loans and advances. These groups are: Resimac, Pepper, Liberty and Firstmac.
  • If you click on a product link and you are referred to a Product or Service Provider’s web page, it is highly likely that a commercial relationship exists between that Product or Service Provider and Savings.com.au

Some providers' products may not be available in all states. To be considered, the product and rate must be clearly published on the product provider's web site.

In the interests of full disclosure, Savings.com.au, Performance Drive and Loans.com.au are part of the Firstmac Group. To read about how Savings.com.au manages potential conflicts of interest, along with how we get paid, please click through onto the web site links.

*Comparison rate is based on a loan of $150,000 over a term of 25 years. Please note the comparison rate only applies to the examples given. Different loan amounts and terms will result in different comparison rates. Costs such as redraw fees and costs savings, such as fee waivers, are not included in the comparison rate but may influence the cost of the loan.

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author-avatar
Emma Duffy is Assistant Editor at Your Mortgage and  Your Investment Property Mag, which are part of the Savings Media Group. In this role, she manages a team of journalists and expert contributors committed to keeping readers informed about the latest home loan and finance news and trends, as well as providing in-depth property guides. She is also a finance journalist at Savings.com.au which she joined shortly after its launch in early 2019. Emma has a Bachelor in Journalism and has been published in several other publications and been featured on radio.

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