Hi all,
I am hoping that some of the great brains on this forum might converge and offer some insight to my financing dilemma. I have posted about it before and thought I had it all sorted - finally, after months of running a refinancing marathon - until a couple of weeks ago...anyway, this is the low down on how I am getting no joy from banks.
I am trying to buy my 4th IP for 268K (preferably in a trust). I bank with SGB and they have 3 IPs + PPOR all x-coll. I'm trying to refinance the PPOR and use the equity in the properties (not sure which ones yet) as deposit/costs for the new purchase. There is substantial equity, and equity has never been the issue.
I approached a mortgage broker via my accountant and they almost had an approval through with ANZ (not in the trust, but in individual names only). At the last hour, 4pm on a friday night, SGB changed their payout figure by 7K. With this, the mortgage broker asked ANZ to increase the loan by 7K (without talking to us first). At this, the request somehow triggered something in 'head office' and the loan was then automatically declined. There are so many problems here that my head is still spinning. In particular, SGB used a 2008 val on one of the properties and used vals that were over 6mths old on the other two properties. The 7K in equity would have been found, I am very certain. But if not, we would have paid cash for the shortfall. Apparently, there was no turning back once the application was declined by ANZ's head office.
Anyway, I then moved on to Westpac (I am very much regretting that I didn't fight harder to win ANZ over!) and although they were hopeful, they would not approve the loan on the basis that my income cannot be substantiated. By this they mean my present income is different from my taxable income in the previous 2 tax years. Mainly because I was on maternity leave (with twins!) and now I am back at work, 2 days a week in my own private practice. BAS statements have made no difference. Banking transfers from my clinic where I work to my bank account seem to not be enough evidence. July - Dec Profit and Loss are also not enough. I have very detailed accounting and my income is consistent month to month now.
Both banks have encouraged me to come back to them once I do the next tax return! They wish!
My options at this point are to either admit defeat OR push ahead and hope that I can find a non-bank institution to fund this purchase. This has been a endurance marathon and I am mentally exhausted from trying to think through solutions. Perhaps this IP is not meant for our portfolio (but, I'm having trouble accepting this).
I am concerned about the impact on CRAA file. I'm not sure whether 2 denials of finance is a bad thing.
My goal is to not only keep buying property but to get the financial structure in order. The x-coll has made it all very difficult and the banker at SGB will not return calls etc.
If this puchase does not go ahead, I would like to refinance some of the properties away from SGB and to have the equity as available cash but I don't know how to achieve this. We could probably use the cash to buy a cheaper IP or use it to renovate our PPOR.
My questions are:
What would you do? Push ahead or admit defeat and just wait a little longer until the tax return is done.
and
Would you try to pull out the equity and put it elsewhere...?
and
Is there anything that I am missing?
Many many thanks in advance,
Mel
I am hoping that some of the great brains on this forum might converge and offer some insight to my financing dilemma. I have posted about it before and thought I had it all sorted - finally, after months of running a refinancing marathon - until a couple of weeks ago...anyway, this is the low down on how I am getting no joy from banks.
I am trying to buy my 4th IP for 268K (preferably in a trust). I bank with SGB and they have 3 IPs + PPOR all x-coll. I'm trying to refinance the PPOR and use the equity in the properties (not sure which ones yet) as deposit/costs for the new purchase. There is substantial equity, and equity has never been the issue.
I approached a mortgage broker via my accountant and they almost had an approval through with ANZ (not in the trust, but in individual names only). At the last hour, 4pm on a friday night, SGB changed their payout figure by 7K. With this, the mortgage broker asked ANZ to increase the loan by 7K (without talking to us first). At this, the request somehow triggered something in 'head office' and the loan was then automatically declined. There are so many problems here that my head is still spinning. In particular, SGB used a 2008 val on one of the properties and used vals that were over 6mths old on the other two properties. The 7K in equity would have been found, I am very certain. But if not, we would have paid cash for the shortfall. Apparently, there was no turning back once the application was declined by ANZ's head office.
Anyway, I then moved on to Westpac (I am very much regretting that I didn't fight harder to win ANZ over!) and although they were hopeful, they would not approve the loan on the basis that my income cannot be substantiated. By this they mean my present income is different from my taxable income in the previous 2 tax years. Mainly because I was on maternity leave (with twins!) and now I am back at work, 2 days a week in my own private practice. BAS statements have made no difference. Banking transfers from my clinic where I work to my bank account seem to not be enough evidence. July - Dec Profit and Loss are also not enough. I have very detailed accounting and my income is consistent month to month now.
Both banks have encouraged me to come back to them once I do the next tax return! They wish!
My options at this point are to either admit defeat OR push ahead and hope that I can find a non-bank institution to fund this purchase. This has been a endurance marathon and I am mentally exhausted from trying to think through solutions. Perhaps this IP is not meant for our portfolio (but, I'm having trouble accepting this).
I am concerned about the impact on CRAA file. I'm not sure whether 2 denials of finance is a bad thing.
My goal is to not only keep buying property but to get the financial structure in order. The x-coll has made it all very difficult and the banker at SGB will not return calls etc.
If this puchase does not go ahead, I would like to refinance some of the properties away from SGB and to have the equity as available cash but I don't know how to achieve this. We could probably use the cash to buy a cheaper IP or use it to renovate our PPOR.
My questions are:
What would you do? Push ahead or admit defeat and just wait a little longer until the tax return is done.
and
Would you try to pull out the equity and put it elsewhere...?
and
Is there anything that I am missing?
Many many thanks in advance,
Mel