Best refinancing deals available

[mech81]

Hi everyone,

Im thinking of refinancing my IP. Had a look around and the best deal I could find is this one
https://www.loans.com.au/Pages/dream-loan-express.aspx

and the good thing is they have guaranteed to keep to the RBA cashrate movements for 3 years. I'm not sure who finances their home loans.

Anyone has any experience with them?
Or does anyone else have a better deal that he/she knows of?

Thanks in advance
Dennis

 

[Aaron_C]

Downside would be the 'redraw' instead of 'offset'. I'm not so sure about these online funders but you can give it a go and see

 

[mech81]

Hi Aaron,

Yeah i noticed the redraw. I'm happy with that as it works almost similar to an offset. The only thing is whether it has any tax implications later similar to paying down a home loan and withdrawing the funds later to pay for something non-investment.

Anyone has any comments on the above?
Dennis

 

[Aaron_C]

Yes, redraw has severe tax implications. Lots more paperwork too

 

[Property Hoarde]

Dennis,

Offset and redrawn are not the same.

Major issue with redraw, the money going into your loan and if you redraw for a personal items you cause major issues with tax deductiblity.

With the offset, it is not going into your loan, basicly it is just cash and you can use for what you like without the issue of tax deductibility of your loan.

If you are going to have extra money to reduce your IP loan, you will want offset not redraw.

 

[mech81]

Thanks Pete. Thats the answer I was looking for. Hmm...now to look for a good deal with one that offers 100% offset facility for a good variable rate...

 

[Mick C]

Thanks Pete. Thats the answer I was looking for. Hmm...now to look for a good deal with one that offers 100% offset facility for a good variable rate...

When it comes to offset accounts you pay for this "feature"- it's not always about the "lowest" rate..but the overall package in regards to total saving when you use the all the features.

I do have a funder that offer 6.59% for refinance + new purchase- full feature loans with the offset...only downside is it comes with an high set up cost of 1% of the loan amount as EST - yes costly set up...but due to no exit fee; smaller lenders are forced to increase set up cost to recover for the lower rates; so only good if you plan to stay with them for 3-5years +


I say look at the overall deal...not just the rate-as rate can change...but "features", fees and service won't

Regards
Michael

 

[Aaron_C]

I agree with Mick. Rates are just one part of the entire deal - more often than not used to lure you in

 

[mech81]

When it comes to offset accounts you pay for this "feature"- it's not always about the "lowest" rate..but the overall package in regards to total saving when you use the all the features.

I agree with Mick. Rates are just one part of the entire deal - more often than not used to lure you in

I totally agreed with what you have said. Thats why I "bounced" ideas off in this forum as I'm still rather an amateur and am learning as I go. The redraw doesnt work for me at all as I have constant in and outgoings.

 

[Aaron_C]

That's fine...good to explore all options of course.

 

[Rolf Latham]

Hi Mech

Before looking at refinancing options may I ask why ?

Rate ? Service ? access to equity ?

ta
rolf

 

[mech81]

Hi Rolf,

that question hits the nail on the head.
Basically looking to see if there's anyway to reduce my cost. I'm not in any distress but if I can reduce my holding costs, then that allows me to chomp my teeth into another piece of meat in about 6-12 months time.

I don't think I have much equity yet as I've only owned my IP for just about 14 months now. I may be surprised but highly doubt it in this Melbourne confidence market.

Thanks
Dennis

 

[Rolf Latham]

Thanks Mech

Whats the loan amount and what was the purchase price ?

t
rolf

 

[Jamie M]

Hi Rolf,

that question hits the nail on the head.
Basically looking to see if there's anyway to reduce my cost. I'm not in any distress but if I can reduce my holding costs, then that allows me to chomp my teeth into another piece of meat in about 6-12 months time.

I don't think I have much equity yet as I've only owned my IP for just about 14 months now. I may be surprised but highly doubt it in this Melbourne confidence market.

Thanks
Dennis

Hi Dennis

What's the current LVR? If it's above 80%, then refinancing prob won't save you as a move to another lender will trigger LMI again.

Cheers

Jamie

 

[mech81]

Hi guys,

Loan amount ~389k
Purchase price 440k

I was lucky when I bought this place I didnt have to pay LMI with an LVR of 90%. I know things have changed and I probably wont be able to get LMI again. Although, I have enough funds to make it LVR 80%, my inkling is not to do that to limit my chance of getting another IP in the near future. Am i right?

Dennis

 

[Aaron_C]

Hi guys,

Loan amount ~389k
Purchase price 440k

I was lucky when I bought this place I didnt have to pay LMI with an LVR of 90%. I know things have changed and I probably wont be able to get LMI again. Although, I have enough funds to make it LVR 80%, my inkling is not to do that to limit my chance of getting another IP in the near future. Am i right?

Dennis

That is correct. Right now your facility is 90% LVR so you have the 10% of equity to take out and use for investment without going to the bank again

 

[Rolf Latham]

Hi guys,

Loan amount ~389k
Purchase price 440k

I was lucky when I bought this place I didnt have to pay LMI with an LVR of 90%. I know things have changed and I probably wont be able to get LMI again. Although, I have enough funds to make it LVR 80%, my inkling is not to do that to limit my chance of getting another IP in the near future. Am i right?

Dennis

Hi Dennis

Im glad I asked the q.

With only part of the info provided we have been trying to find PRODUCT based soln for you, as you have, while all the time there wasnt one.

This isnt having a go at you, more a point that I am making that most folks look at many lending scenarios rfom product rates fees and charges, when in mnay cases, thats NOT where you start. Its a common lender /broker problem because we get so excited about a new deal

If u are looking to move that loan based on that current loan and val ur LVR is still 90 %................most lenders wont touch that without u paying new LMI.

Not much commercial point in refinancing to a new lender per se.

Id suggest you speak with Aaron, Jamie or Mick off this post and see what you can come up wiht for your future.


ta
rolf

 

[Kanemicm]

Hi everyone,

Im thinking of refinancing my IP. Had a look around and the best deal I could find is this one
https://www.loans.com.au/Pages/dream-loan-express.aspx

and the good thing is they have guaranteed to keep to the RBA cashrate movements for 3 years. I'm not sure who finances their home loans.

Anyone has any experience with them?
Or does anyone else have a better deal that he/she knows of?

Thanks in advance
Dennis

Not a bad rate Dennis, also check out UBank, they have it at .1% less for refinancing.

 

[Rolf Latham]

Not a bad rate Dennis, also check out UBank, they have it at .1% less for refinancing.

Not after having to pay LMI again

ta
rolf

 

[Mick C]

Ubank's max LVR is 80% as well

As ROLF mentioned at 90% LVR and the loan amount...i don't think a refinance will help unless your on a rate higher then 7.2%.... the application fee+ legal + title swap + gov charges AND LMI will eat up any benefit for the next 3-4 years....


P.s most of the time a simple call to your bank manger to ask for a 0.05%-0.1% off will do the trick!


Regards
Michael