Cocaine, Alcohol and Home Loans

Graeme Salt

No, no, this is not the range of services I offer, but a reflection of the sorts of loans that people can get.


It all started when a wise woman with quite a few years’ lending experience described a split loan as a cocktail loan – because they were more fun. This got me thinking as to how you would describe the various loans on the market.


Your basic loan is your VB. There is nothing sophisticated about it; it does the job. If you just want a loan with no frills, this is what you want.


Professional packages are more like one of those tasting paddles you get at wineries or craft breweries. With most of these you can choose the bits you really like: offset loan; credit card; discounted insurance; and financial planning. Trouble is, they often come with hefty fees that can leave you with a bit of a hangover.


Variable loans are like a Big Night Out at The Cross. As interest rates rise and fall, there can be huge highs and lows with variable loans.


Fixed loans are like light beer. You are trying to play it safe with a fixed loan. The trouble is, if you fix at the wrong time and variable rates drop, you end up missing out and thinking that everyone around you is having all the fun.


Lines of cocaine and lines of credit can have a lot in common. Because a line of credit is essentially an open cheque-book for a few hundred thousand dollars, there is a great temptation to splurge the money at the casino. Spending can become addictive and rack up a huge amount of debt. But for those with discipline, lines of credit can be really effective – so long as you don’t get addicted.


Me, I prefer a nice cup of tea.


Graeme Salt can be contacted on 02 9922 5055