Does anyone have any experiences or opinions with Qantas CU home loans that earn Qantas Points?

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Hi there

Im just getting started on the points obsession and I’m looking to buy a house soon. I’ve seen an offer from Qantas Credit Union where you earn 150 points a month for every $1000 you owe on the loan. I’ve calculated a very general estimate that I’ll be earning between 50000- 60000 points per year (initially), and at current interest rates that will cost me about $1100 a year more than the cheapest basic home loan (4.39% v 3.99%). I’m trying to be sensible about it – this does appeal to me a lot, because I want so much to still be able to travel once I’ve got a mortgage! ….but I’m not 100% sure it’s worth it. I just wondered if anyone has experience or is also considering this product?

Thanks

Felicity.

 

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Hi Felicity – welcome!

First of all, well done on doing the math first! Point hacking is addictive, so using your head first is really important.

I don’t have any direct experience with this product nor QCU, but I might be able to help with some cost-benefit calcs.

Going off Keith’s valuations here, his earn target for Qantas is 1.40 cpp. At your highest earn there of 60,000 QFF points, you’d be “paying” 1.83 cpp ( ($1,100 x 100) / 60,000 ), which means you’d be paying more for your points than you actually think they’re worth. (Of course you may have your own earn target that you’ve derived yourself – if so, plug that number in instead.)

If you were able to earn ~79,000 points per year from it, then you’d be breaking even. Anything greater than that would be a net win.

Of course there are other things to consider as well i.e. customer service at QCU, what other products they offer, offset accounts etc.

Unfortunately, renting seems to be much more compatible with point hacking. 🙁

  • Hi Darrenk, hacker for about 6 months. What do you mean when you say renting is more compatible for hacking?

  • Hi darthflyer!
    There are a couple of different ways of paying your rent through credit-card (http://www.rentalrewards.com.au/ is one example) with a manageable surcharge that can net you quite a haul of points at the end of the year (as always, you’d need to do the math to make sure it’s worth it for you). However, I’ve not seen any risk-proof way of using your credit card for mortgage payments.
    The other concern is that for most mortgage-holders, your offset account is your most important account, so moving money from that account into a point-earning account like the BankWest product (which can’t be used as an offset account) actually ends up costing you more (in extra interest) than what you would gain in value from the points. A renter doesn’t have that same restriction, and can move money around as much as they’re willing to.
    Of course there are sweet deals like the NAB home loan with the 250k VFF points on sign-up. But the slightly higher-interest rate you’d pay there would cost you more in the long-term than a lower interest rate negotiated at another bank, or through an online-only lender or credit union.
    Just my thoughts… :)

  • Thanks Darrenk!

    I was aware rentalrewards already (I find the fees a little too high for my liking). I was hoping there was another option out there that I had not thought of or found yet :-)

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Hi darrenk,

thank you so much for your thoughts, I hadn’t managed to do the cpp conversion and it’s making me think twice now you’ve pointed it out. It’s tricky with all these unpredictable and/ or arbitrary factors like changing interest rates and personal values on the points isn’t it…?

I’ll keep thinking

thanks again!

felicity.

  • Yeah, it’s a complicated game Felicity!
    It’s worth contemplating, though, that frequent flyer points can offer you experiences that you would never be able to afford either (i.e. first class!) so you may be able to justify “paying” more for your points if that’s a trip you have in mind. As long as you end up spending less on points than a retail first-class ticket, you’ve won (although it does erode a lot of the value).

  • I’ve got the Qantas CU Points Mortgage product. There application process for this was rather smooth compared to some of the experiences my friends have had with their Credit Card.

    I didn’t calculate it to the level you already have. Although, the circumstances that led to me taking a mortgage out perhaps are fairly different to how most people end up taking out one (for family reasons, not for myself) and having the lowest cost product on the market was never really a consideration for me.

    My reasoning for going with this product was perhaps along the lines of what darrenk suggests – points can give me experiences that I mightn’t otherwise be able to readily afford with this massive expense hanging over me!

    That said, when I refinanced with QCU their product was cheaper than the mortgage product I was on with another credit union – so I considered it win … and I got points, for less! I figured _worst case scenario_ I’d just be essentially paying forward some of my travel expenses, which made it a slightly obscure way of saving.

    Definitely worth considering such a commitment carefully though!

    I’m coming up to my 2 years with the product. I’m quite happy with it :)

  • Hi Nick
    Thank you for your perspective, I was really pleased to hear it, as I’m almost through the application process. I’m going for it. My rationale might be a bit similar, I’ve had family move OS and I’m worried that with a mortgage I won’t feel like I can travel to see them. I’m hoping to get really good at the hacking now…
    Thanks again!

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