ING DIRECT Orange Advantage Loan Review

Darren Pearce
Jul 14, 2016( 7 min read )

The basics

The ING DIRECT Orange Advantage Loan offers a low variable interest rate which can be 100 per cent offset with funds held in an Orange Everyday transaction account. The combination helps reduce the interest charged on your mortgage and can accelerate you towards your goal of paying off your loan sooner.

The ING DIRECT Orange Advantage is available to owner occupiers, first home buyers, refinancers and investors and probably best suited to borrowers who prioritise a competitive interest rate but don’t want this to come at the expense of flexibility, additional features and banking convenience.

If your objective is to pay off your home loan as quickly as possible, Orange Advantage allows you to have your income deposited directly into the offset account. The interest is calculated daily on the total outstanding loan amount less the funds in your offset account, so the more you have in your offset account the less interest you are charged on your home loan.

The option to get access to any additional payments you have accrued whenever you may need them can be an important feature for many borrowers. The Orange Advantage provides a redraw facility with fee-free access. There is no minimum redraw amount and there is no limit on how many redraw transactions you can make.

Like most banks, ING DIRECT offers discounted interest rates which are dependent on which loan you choose and how much you borrow. Lower rates are available for owner occupier loans – that is, someone who lives in the home they own – when borrowing $150,000 or more. Further discounts may apply if borrowing less than 90 per cent of the property’s value, so it’s worthwhile negotiating with the bank on this basis.

More specific information on the ING DIRECT Orange Advantage Loan is available here.

There are no application fees, monthly fees or split loan fees. An annual fee is applicable but waived for the first year. Additionally, ING will waive the fee on your first valuation of a property while the other upfront fees are relatively minor. As always, it is good practice to check for the latest offers and negotiate your best deal based on competitive alternatives.

For the more risk averse borrower who prefers some protection from interest rate rises you can combine the Orange Advantage with a Fixed Rate Loan. ING DIRECT offers an application fee waiver and for Owner Occupier borrowings you’ll receive a fixed interest rate discount.

The highlights

If you are an owner occupier looking to pay off your loan in the shortest possible time and your idea of banking does not require access to local branches and a cheque book, then ING DIRECT’s branchless banking model has a number of features worth considering.

Customers who prefer to setup their loan and then focus on paying it off as quickly as possible can find a comfortable fit with this package. Despite the lack of branch access, you can withdraw funds from any ATM in Australia for free when you have both an Orange Everyday transaction account and any ING DIRECT home loan. The package also offers free unlimited ING DIRECT online transactions such as BPay® and Pay Anyone.

The ING DIRECT branchless model accommodates customers who are more tech-savvy and feel comfortable with access provided via online and over the phone by a customer service team with an extremely high reputation. ING DIRECT promotes itself as ‘Australia’s Most Recommended Bank’ based on a measure of customer satisfaction called the Net Promoter Score. The score rates a customer’s willingness to recommend the bank and its loan products to a friend or colleague and on this measure ING DIRECT has achieved consistently higher customer satisfaction scores than the big four banks.

Access to your account is provided via online and phone banking 24 hours a day, seven days a week along with phone support with home loan specialists. If you are already accustomed to accessing your bank almost exclusively via your mobile device, then you will find the mobile banking app and the online tools a natural step.

The lowlights

The package offers the flexibility to make monthly interest-only repayments or principal and interest repayments which can be either monthly or fortnightly. However, these payments are restricted to direct debit or salary credit, with no other repayment options available.

While ING DIRECT is a non-bank lender which positions itself as a challenger to the traditional banking model, the Orange Advantage loan remains a full documentation product. This means you will still be required to provide a complete range of personal and financial information along with employment details in order to have your application processed in the normal timeframe. This can be an issue for some self-employed customers who are looking for a non-major bank low doc loan option.

ING DIRECT’s Orange Advantage holds its own on offering discounted fees when compared directly with fully featured variable loan packages offered by the big four banks, but lacks bundling features such as credit cards and discounted home, car and loan protection insurance products.  If you already have a number of other financial products with a mainstream bank it might be worth exploring the benefits of bundling your new loan to save on credit card fees and insurance costs.

Similarly, if you are someone who prefers to be able to sit down with your bank face-to-face to deal with specific complications to your loan, then the branchless model may not be for you.

The verdict

If you are looking for a loan package with a very low rate, there are a number of non-major banks and online lenders which offer sharper rates. Similarly, if you are someone who prefers the reassurance of dealing with people you can build a relationship with at your local branch and you value a fully featured loan with all the bells and whistles, then the mainstream lenders may be a better fit.

However, if you have a regular income, are tech-savvy and prefer a loan with a number of features with a balance between price, flexibility and convenience, and your focus is to start paying off your loan as quickly as possible, then the ING DIRECT Orange Advantage can be a good match for your home loan objectives and banking lifestyle.

The last word

Choosing a home loan is a huge decision and one that may have implications for two or even three decades, so it is important you take the time to do your due diligence to determine if this loan package is a good fit.

It’s all a matter of finding the home loan that will be the best match for your individual circumstances.

If you are in any way unsure it could be worthwhile seeking professional financial advice to determine if this product is the right one for you.

Note: This review provides general information about the above home loan. Any views expressed are the author’s own. It is not intended to be a recommendation of a particular product. To the extent that this commentary may constitute general advice, this advice is of a general nature and does not take into account your individual objectives, financial circumstances or needs. We recommend that before you make any financial decision you seek professional advice from a suitably qualified adviser and read the PDS. Read more about our important disclosures here.

About the author

Darren Pearce

Darren Pearce is a personal finance expert and freelance writer.

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