Banks

From: Gail H


Hi everyone,
I have been desperately trying to get finance for a block of flats that I have purchased. My 2 problems have been that I am newly self-employed and that the flats are not strata titled but are 5 properties on one title.

Well, my usual (non bank) lender just wasn't interested. In fact, they told me that unless I had been self-employed a minimum of 2 years, then I would have to go on a no docs, high interest loan, no exceptions. In fact, to release equity from my home, I would have to refinance my entire home loan on a no docs loan!

To cut a long and arduous story short, I have found that it is one of the big banks who will show me most flexibility. They will take my earnings so far this financial year and project them forward (hallelujah) and will fund the flats on an 80/20 LVR. Plus they will put me onto the professional package which offers interest rate discounts.

It hasn't come through yet,so we'll see, but it is interesting to know how much it pays to persevere and shop around.

Lessons? Well, it seems to be that the bigger banks now offer a much much more diversified product these days, plus they are able to bring a little bit more discretion to the deal. The smaller lenders seemed more rigid to me, but maybe that's just my experience. I guess the smaller lenders have to have more standardised risk management policies in place.

Cheers everyone,

Gail
 
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Reply: 1
From: Michael Yardney


Gail
I've always found the big banks helpful, but it's the old storey of who you know.
Unless you have your own business banker or a private banker it is usually worth dealing with the big banks through a broker (and there are a few good ones on this forum) as they can get you better deals than you could get yourself.
But once you are at the next level.....all sorts of different deals are made by the banks.
If you are still having difficulty we have as special NAB manager allocated to our clients (no kickbacks or commissions to me)who is very helpful. Please email me and I will give you his details myardney@metropole.com.au
Just a little general reminder, not specifically to you Gail: if the banks are wary of giving you a loan, maybe they can see the situation with less emotion than you and maybe you are over extending yourself!
Michael Yardney
Metropole Properties
 
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Reply: 1.1
From: Rolf Latham


Hi Michael

Good point and............

A broker cant always get the deal done.

It all depends on the circumstances, but if someone comes to me with a situation that doesnt fit into any lenders box due to employment criteria, the first port of call must always be the clients exisitng lender. There's no point sullying someones CRAA with dud applications if the chance of getting through is small.

Then they should do the rounds of the biggies and see where the reality lies. A broker can structure deals and get best rates etc etc etc, but cannot commonly sell a clients business to the lender as well as the client can. I mean, after all who knows the clients business the best ? The key is getting to someone that can sign off on the deal there and then. There is no point going through the usual application takers at most lenders. You need to ask the question - who signs off on this ?

Finally if this has not worked (and usually NAB,CBA, and STG in that order may take it on) then I will bat on with the client until the last resort is some form of no or lo docs finance. This is not as expensive as it once was, and for self employed people buying investments rates its now only a couple of points above standard banks rates.

Ta

Rolf
 
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Reply: 1.1.1
From: Duncan M


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> There's no point sullying someones CRAA with dud applications

Hi Rolf,

Could you expand on this statement a little? What do lenders actually look
at when they examine a CRAA report?

Regards,

Duncan.

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> There's no point sullying someones CRAA with dud applications


Hi Rolf,


Could you expand on this statement a little? What do lenders actually look at when they examine a CRAA report?


Regards,


Duncan.




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Reply: 1.1.1.1
From: Frank Shead


Is it my impression that if you are in investment mode you must always go to the lowest interest rate like NAB's 3.99%. If these facilities will not help, pay the higher interest rate and get what you want.

At the end of the day if you have not got what you want - you must be behind the eight ball.

If your deal stacks up, it must be what ever it takes to get over the line.

Frank Shead
 
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Reply: 1.1.1.2
From: Rolf Latham


Hi Dunc

The best thing you can do to answer that question is to retrieve a copy of your own - for free at

www.creditadvantage.com.au

Will take a while, for a sum of ?? you can get ot faster but this is just for eductaional means.

Lenders look for what you have applied for and when, correlating this with what you are loking for now.

Undisclosed debts, loans and defaults are also obvious targets.

So three loan apps in a month for the same marginal deal, and then a fourth knockback does not make for a stronger assesment. Indeed many lenders use autoassesment figures for the number of CRAA eqnuiries, beyond a certain point and the look at an app quite hard delegating to higher authority.

A hammered CRAA can mean the diff between sink or swim.

Ta

Rolf
 
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