For mortgage borrowers who want convenience and the added benefits of having their financial products with one financial institution, getting a professional package home loan could be a viable option.
No doubt you have heard to be careful to pay only for the bells and whistles you need when securing a home loan, but what if you could get them for free? A professional package can wipe thousands of dollars in interest off your home loan and many years off your loan term – just by choosing your loan more carefully.
What is a professional package?
A professional package home loan, also called a pro pack, is a mortgage bundled with additional products. Sometimes called discounted loans, it is a promotional offer lender uses to help attract clients to try and get their other financial offerings.
Technically speaking, the pro pack is not a loan type — it is an overarching product that offers a range of discounts while allowing you to continue to pay an ongoing monthly or annual fee with your home loan.
Generally speaking, a pro pack includes any of the following:
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interest rate discounts on variable rate home loans
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up to four credit cards with no annual fees
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free or discounted offset and savings accounts
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discounts on insurance including building, income protection, and landlord protection insurance.
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discounted car insurance
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fee waivers or reductions on valuations, top-ups, and switches
Many lenders offer better and more competitive deals to borrowers who are borrowing with a low loan-to-value ratio (LVR).
However, those who are buying with up to 95% LVR (which means they only have 5% deposit) can also get a better deal compared to applying for a standard home loan.
How and when did pro packs become a thing?
When the banking sector was deregulated in the 1980s, local banks got something they weren’t used to – competition. Since then, banks have sought to have a competitive edge on the lender down the road. This was the situation in the late 1990s.
Rather than focusing purely on marketing tricks, banks decided to selectively pursue borrowers they considered to be low-risk, high-debt customers. While determining who these people were, banks realised this group was generally made up of professionals such as accountants, solicitors, doctors, chemists and teachers.
The banks decided to offer a discounted range of products and services to these professionals as a reward for high-quality, high-profit businesses. These products and services were bundled up as a special package and the term professional package was born.
However, as competition remained high as time went on, banks started offering pro packs outside the typical borrowers falling under the said processions. Although the term pro pack stuck, the classic delineation of its being provided to professionals has mostly been abandoned, with discounted, packaged banking now available to anyone who wants it and appears able to repay a large debt.
Is a professional package right for you?
A pro pack may be suitable for you if you see yourself in these circumstances:
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You are borrowing more than $250,000.
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You are likely to make changes to your borrowing.
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You use a credit card.
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You require more than one split.
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You might add some fixed rates into the mix.
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You want to simplify the management of your money.
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You want to maximise savings through interest offset features.
What are the advantages of a professional package?
If you are the type of borrower who wants a one-stop shop for all your financial needs, a pro pack is perfect for you. It provides the convenience of having to operate all your banking needs under one lender. In some cases, you will also be assigned a personal banker — a huge upside, especially if you want a personalised banking experience.
This convenience comes with flexibility. You are able to talk to your lender directly about your loan, allowing you to make adjustments and clarify concerns with ease.
Here are some of the benefits of getting a pro pack:
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Discounted mortgage rates — You will enjoy discounts on the standard variable rate that increases depending on the amount you are borrowing.
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Discounted financial products — Since your home loan is bundled with other financial products, your lender can offer discounts on them as well. You might also be given a fee waiver for these products.
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Convenience — You can use the other financial products bundled into your home loan to save — offset accounts, for instance, which can help reduce your interest charges.
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Flexibility — It will be easier for you to manage your products given that they fall under one lender or financial provider. For instance, you will only pay one annual fee for all the products you have under your professional package.
Are there any downsides to getting a professional package?
A pro pack is ideal on paper, but it is not actually for everyone who wants to save when applying for a mortgage.
Borrowers who do not really need any other financial products might get overwhelmed with the commitment it takes to, for instance, maintain a credit card or pay for insurance when they get a package home loan.
If you do not use a credit card, have a limited budget for other financial products, and would like to stick to the basic, no-frills version of a home loan, it might be best to stay away from professional packages.
What are the disadvantages of a pro pack? It will depend on your needs, but here are some general downsides to getting it:
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Pro packs usually have an annual fee, which could be between $300 to $750.
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If things go awry with your current provider, it might be a struggle to switch several financial products.
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You might miss out on better deals for certain financial products.
Frequently asked questions about professional package loans
If you are still undecided if you are going to get a pro pack, these frequently asked questions can help you decide if it would be right for you.
How much income do you need to get a professional package mortgage?
While professional package home loans were initially catered to high-income borrowers, lenders started offering this type of bundle to everyone who wants to borrow at least $250,000.
Which lenders offer professional package home loans?
Australia’s biggest banks — ANZ, CommBank, NAB, and Westpac — offer professional package home loans to their borrowers. Most other lenders also have such bundles and are advertised as home loan packages.
Are there any fees when getting a professional home loan package?
Yes, most lenders charge annual fees that could range from $300 to $750 for professional packages. The fee will be dependent on the other financial products you bundle with your home loan. This fee covers all recurring fees for all these products.
Do you need to seek help from a mortgage broker?
It is encouraged that you seek advice from a mortgage broker when looking for professional package home loans. With their network, brokers can find the right lender that can offer you the best options based on your financial circumstances. However, there’s no stopping you from going the do-it-yourself route — reach out to your trusted lender and check your options.
Article first published June 2009; last updated September 2022.
To help you see the current home loan rates available in the market, use Yourmortgage's comparison table:
| Lender | Home Loan | Interest Rate | Comparison Rate* | Monthly Repayment | Repayment type | Rate Type | Offset | Redraw | Ongoing Fees | Upfront Fees | LVR | Lump Sum Repayment | Additional Repayments | Split Loan Option | Tags | Features | Link | Compare |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
6.04% p.a. | 6.06% p.a. | $2,408 | Principal & Interest | Variable | $0 | $530 | 70% | Featured Online ExclusiveUp to $4k cashback |
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5.99% p.a. | 5.90% p.a. | $2,396 | Principal & Interest | Variable | $0 | $0 | 80% |
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6.14% p.a. | 6.16% p.a. | $2,434 | Principal & Interest | Variable | $0 | $250 | 60% |
| ||||||||||
5.94% p.a. | 5.95% p.a. | $2,383 | Principal & Interest | Variable | $0 | $0 | 90% | |||||||||||
5.99% p.a. | 6.14% p.a. | $2,396 | Principal & Interest | Fixed | $10 | $440 | 90% | |||||||||||
5.99% p.a. | 5.99% p.a. | $2,396 | Principal & Interest | Variable | $0 | $150 | 60% | |||||||||||
5.99% p.a. | 6.32% p.a. | $2,396 | Principal & Interest | Fixed | $6 | $799 | 80% | |||||||||||
6.04% p.a. | 6.06% p.a. | $2,408 | Principal & Interest | Variable | $0 | $530 | 90% | 4.5 STAR CUSTOMER RATINGS |
| |||||||||
6.04% p.a. | 7.15% p.a. | $2,013 | Interest-only | Fixed | $0 | $180 | 90% | |||||||||||
6.14% p.a. | 6.17% p.a. | $2,434 | Principal & Interest | Variable | $0 | $445 | 60% | |||||||||||
6.14% p.a. | 6.15% p.a. | $2,434 | Principal & Interest | Variable | $0 | $0 | 80% | |||||||||||
6.19% p.a. | 6.44% p.a. | $2,447 | Principal & Interest | Variable | $248 | $350 | 80% | |||||||||||
6.24% p.a. | 6.48% p.a. | $2,460 | Principal & Interest | Variable | $250 | $250 | 80% | |||||||||||
6.59% p.a. | 6.82% p.a. | $2,552 | Principal & Interest | Fixed | $8 | $0 | 70% | |||||||||||
6.74% p.a. | 7.37% p.a. | $2,592 | Principal & Interest | Fixed | $0 | $160 | 90% | |||||||||||
6.84% p.a. | 7.16% p.a. | $2,726 | Principal & Interest | Variable | $0 | $0 | 95% |
Collections: Professional packages
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