Dealing with BANKS!!!

[jacbmw]

Hi everyone,

Absolutely sick to death of dealing with banks/mortgage brokers.

Not sure whether what I have been experiencing is just par for the course (as banks have you by the balls in many respects as far as service is concerned), or should I look to other institutions for next purchase.

Basically current bank (with whom i have just completed one refinance, and one purchase, looking for another refinance asap and another purchase in next 4-6 months), have no consideration for urgency (even when you have stressed there are large financial costs to you for every delay) and there are consistent descripancies between what is agreed and what is put forward (ie. Agreed on 90% lend, and get contract and they have noted a figure that is actually 89.95% lend (which is $1k less)...

Firstly: Any techniques to get a bank working more efficiently? How can you esculate things when you have gone through the broker channel, and the broker is not pushing things urgently enough? Does it have much pull when you treaten to pull the pin on the deal and look else where, or does the bank think "whatever, we are a bank and there are heaps of other customers looking to get our money"???

Secondly: When the bank makes these small "errors" in key figures, are they infact errors, or are they attempts to sneak small amendments through in their favour? Would you continue to deal with a bank in the future?

Furthermore, I get on well with my broker, and feel he works well with me, however sometimes I feel he is inflexible (flately said that it was not possible to get finance at anything else but clean 5% increments - ie. 85%, 90%, 95% etc). Have since found out that through same institution you can get any % loan in 1% increments!!!!!!!!!

Basically, I am trying to decide if the way my current broker/bank are operating is standard, as there is no point pulling the pin if the grass isn't even any greener???

What do you all think? How have you all been stuffed around before, and what is standard/tolerable?

Cheers, Jacob.

 

[Ms Jade]

Wow, I'm pretty sure your broker is not on this forum if that's how well informed they are. I have had bank docs come through with errors more that once so don't know how this can be avoided. However, there are some excellent brokers that will expedite and check docs for you. I suggest you contact some of the ones on this forum ASAP.

 

[jacbmw]

I have loan approval on this purchase through my current broker, so am assuming it is to late to switch to another broker?!?!

Will definitely be looking around next time around for alternative brokers...but the banks behaviour sounds standard by the sounds?!?!?

Not much hope really if you want their money!!!

 

[Qlds007]

Hate to say the average standard of service for most lenders is a disagrace and most Brokers dont even tell their clients some of the aggrevation they have to go through to get a deal over the line for them.

Unfortunately they are all as bad as each other so just boils down to the relationship your Broker has with the lender or his/her BDM and what they can do to move it along for you.

 

[Piston Broke]

Basically current bank (with whom i have just completed one refinance, and one purchase, looking for another refinance asap and another purchase in next 4-6 months), have no consideration for urgency (even when you have stressed there are large financial costs to you for every delay) and there are consistent descripancies between what is agreed and what is put forward (ie. Agreed on 90% lend, and get contract and they have noted a figure that is actually 89.95% lend (which is $1k less)...
Cheers, Jacob.

Once again "Those who want it or need it the most, pay the most", me.
If it's costing you every day, why should they care?
They don't, and they know you have to do it because you told them.
It's basic negotiating 101. If your in a hurry, and I can wait: good for me, bad for you.
If you can tell them to shove it and walk away, it may be different.
You can't really complain about "must do the deal now" and paying a higher price.
It's the rule of investing & negotiating.
The banks will always do that, it's a given you need to account for.

 

[Bradsdad]

G'day Jacob,


Sorry to say but the variance in the loan amount is most likely due to the fact that your broker applied for this amount NOT the bank changing figures on you. If the decrease was made due to very tight servicing then the bank would have advised your MB accordingly. As he/she hasn't passed such feedback onto you I'm assuming this isn't the case.
As for only 5% increatments this is a load of.....well you know what unless it's some weird lender with weird policies that I've never dealt with.

You make mention that there was some urgency with the deal so you're probably stuck for now using your current MB. It is possible to apply (even through same lender if they are in fact a suitable fit) via another broker but the application process would need to start from scratch.


Regards
Steve

 

[bcoombs]

All banks are pretty pathetic to deal with at the moment. They are free to do and charge as they please. Remember the broker channel is a competing channel for them at the moment. They make the rules not the broker and this depends on the assessor. Very rarely when you escalate does the bank change its mind. Nor does it care when you go elsewhere. However they will at times issue a decline notice to the broker and then call the client direct and offer them a loan.

The issue is the general public's desire to ask for a "bank" loan. I am not sure why they don't just go direct. As a broker I would rather charge $500 to package the loan and hand it to a branch manager and walk away. I actually did this for a customer that insisted on a CBA loan. Approved on the spot, however after that his problems started........ 3 months later he came back.

So in answer to your question, Banks are pathetic to deal with. Not all brokers are the same, but 90% would be fine. What is different is if the broker gets an understanding of what you are trying to do. However you have to be pretty open to the lenders they suggest. Remember the decision is ultimately yours.

 

[jacbmw]

Thanks for all the feedback guys... God, guess there is nothing we can do about dealing with crap banks (apart from insulating ourselves from them with a great broker as much as possible)!!!!

Will definitely be opening myself to some of the brokers on here next loan/refinance...

 

[Dazz]

I find when dealing through a broker, the Banking folk ask the minimum amount of info from them. It still includes what your jock size is and whether you have painted fingernails or not, but it's not nearly as intrusive as when you are dealing with Banks direct.


I've just had a pretty big ding-dong with my major financier, mainly over them insisting to see my entire portfolio, and not just their bit. NCredit squirrels asking no less than 6 times, and me issuing no less than 6 refusals. They aren't entitled to see it, that is the privilege of the investor. This "we would just like some comfort and to fully understand our client" is a crock.


An article in today's AFR reports the big 4 are reporting profits of 7.4B I think for the half year. They are making oodles, and in no fear of losing anything.


I eventually cracked a wobbly and threatened to disengage myself completely from them, and had to take it 2 levels up. The big boss eventually relented and came back to the table and agreed to extend the finance package on the same conditions and security levels as before.


It feels like we've had a huge win, but really we haven't, we've simply fended off the ol' fine tooth comb up the plughole, and it is back to situation normal.


I just feel frustrated when things are ticking along smoothly, and you get bankers insisting on stuff as pre-conditions, when they are not necessary for their "comfort levels"....and it comes down to having to threaten to disengage completely before they relent.

 

[Ausprop]

It feels like we've had a huge win, but really we haven't, we've simply fended off the ol' fine tooth comb up the plughole, and it is back to situation normal.

you have had a huge win Dazz. I know of very wealthy (well ex-wealthy now) guys that simply had a receiver appointed to wrap the matter up. I assume you aren't with st george, suncorp or bankwest to name a few. rolling over large facilities at the moment is a great hurdle to jump

 

[Dazz]

Maybe Ausprop, they never show their hand, so you are always guessing what they might do.

 

[josko]

Hate to say the average standard of service for most lenders is a disagrace and most Brokers dont even tell their clients some of the aggrevation they have to go through to get a deal over the line for them.

Unfortunately they are all as bad as each other so just boils down to the relationship your Broker has with the lender or his/her BDM and what they can do to move it along for you.

Got to back you up there.

The banks are really picking and choosing their clients and unfortunately, there is just not much a broker can do about it. You could also have some young guy in credit without a mortgage assessing your file who just wants to go away for the long weekend.

jac, if you have an Unconditional Approval- run with it. It is not something to be shrugged at!

I also might add that your broker probably saved you more money than the 1k was worth! Once you hit 90% you jump up into a larger scale of LMI. Your broker probably did you a favour and the 1k could have cost you $900. It is a juggling act atm.

There seems to be alot of aggrevation coming from the Insurers and anything over 80LVR is just a hard pull.

Although we here in Aus have come through the GFC barely scathed, it seems the MI's are still assessing criteria based on the global market - ie USA.

Lo Docs are a no go area based on statistics that approx. a third of refi's went belly up...in Aus.

On the Good News front:

A little birdie told me yesterday that it is possible to get an 80-83% LVR no LMI Vanilla Full Doc.....and the big banks including ANZ are reviewing criteria to ease the squeeze. Can't happen soon enough in my books!

PS: Just reread your post.... 5% increments - rubbish and perhaps your broker can't take the credit for the <LVR? In anycase they did you a favour.
Regards JO

 

[euro73]

Hi everyone,

Absolutely sick to death of dealing with banks/mortgage brokers.

Not sure whether what I have been experiencing is just par for the course (as banks have you by the balls in many respects as far as service is concerned), or should I look to other institutions for next purchase.

Basically current bank (with whom i have just completed one refinance, and one purchase, looking for another refinance asap and another purchase in next 4-6 months), have no consideration for urgency (even when you have stressed there are large financial costs to you for every delay) and there are consistent descripancies between what is agreed and what is put forward (ie. Agreed on 90% lend, and get contract and they have noted a figure that is actually 89.95% lend (which is $1k less)...

Firstly: Any techniques to get a bank working more efficiently? How can you esculate things when you have gone through the broker channel, and the broker is not pushing things urgently enough? Does it have much pull when you treaten to pull the pin on the deal and look else where, or does the bank think "whatever, we are a bank and there are heaps of other customers looking to get our money"???

Secondly: When the bank makes these small "errors" in key figures, are they infact errors, or are they attempts to sneak small amendments through in their favour? Would you continue to deal with a bank in the future?

Furthermore, I get on well with my broker, and feel he works well with me, however sometimes I feel he is inflexible (flately said that it was not possible to get finance at anything else but clean 5% increments - ie. 85%, 90%, 95% etc). Have since found out that through same institution you can get any % loan in 1% increments!!!!!!!!!

Basically, I am trying to decide if the way my current broker/bank are operating is standard, as there is no point pulling the pin if the grass isn't even any greener???

What do you all think? How have you all been stuffed around before, and what is standard/tolerable?

Cheers, Jacob.

5% LVR increments. Thats new. You can get loans at $1, $100, $1000 increments, strictly speaking! I dont know your broker and wouldnt wish to be unfair, but perhaps he isnt the best person to assist you, moving forward if thats the advice youre receiving. As for the banks service, its an unfortunate side effect of the fact that more than 95% of loans have been directed to the majors over the last 18 months by mortgage brokers. The banks now enjoy an oligopoly so you cant just wait, basically. There are many smaller lenders with rates as cheap or cheaper than the big 4, and far quicker service Unfortunately you may need to prompt your broker to direct your loan towards them. Or find another broker who understands that there are cheaper and faster options available outside the big 4.

 

[Kristine..]

You can get any loan in $1 increments at any combination of LVR at 0.01% increments up to the product maximum

I'm writing up an application right now for $456,606 at 48.06%LVR, just had one approved for $468,186 at 88.00%. At 88.01%, being $456,607 would have cost the customer another $1,906 in mortgage insurance premiums - a very expensive $1 indeed!

Put an application in this aftrnoon for $104,517 at 79.48%.

These three applications are all with different lenders, different towns, some full doc, some low doc.

Phooey to brokers and bank lending officers who simply do not care enough about the well being of their customers to take a little trouble with the applications.

After all, it's your money, Ralph!

(Gosh! That dates me, doesn't it!!)

Cheers
Kristine

 

[Kristine..]

Lo Docs are a no go area based on statistics that approx. a third of refi's went belly up...in Aus.

Hello Jo

Can you point me in the direction of your statistics regarding refinancing and also regarding low doc loans?

In seven years of broking I can't recall having any refinance customer of mine, or any low doc customer of mine, running into difficulties with management of the loan. For the figures to show that 30% of refinance loans have failed leaves me somewhat mystified

I would be interested in reading the statistics you quote to see where the problem areas are

I am also having no real problem with low doc loans at all except for some lending policies in regional areas, but that is a market risk factor rather than a borrower factor

Thanks
Kristine

 

[Bigtone]

Hello Jo

Can you point me in the direction of your statistics regarding refinancing and also regarding low doc loans?

In seven years of broking I can't recall having any refinance customer of mine, or any low doc customer of mine, running into difficulties with management of the loan. For the figures to show that 30% of refinance loans have failed leaves me somewhat mystified

I would be interested in reading the statistics you quote to see where the problem areas are

I am also having no real problem with low doc loans at all except for some lending policies in regional areas, but that is a market risk factor rather than a borrower factor

Thanks
Kristine

I think that should have been 3% for low doc refinances in arrears and 5% when it involved significant cashout hence the tightening of the policy.


My uneducated theory is basically the big banks or mortgage insurers won't do much of them but the niche players will be active in this market as credit squeeze eases as a way of getting some market share, once they eat into m/s big banks will come back into market just like what happened when low docs started lead by the smaller players.

my two cents

 

[Kristine..]

Hi Bigtone

Which Bank just approved a $450,000 low doc cash out for a customer of mine

A subsidiary of the same bank just approved a major refinance - just shy of $1,000,000, with $100,000 uncontrolled cash out, and a purchase loan of nearly the same amount.

There seems to be a lot of rumours flying about, but being at the coal face as I am, my experience is that, as always, it is the quality of the application which wins the deal

The preparation of the borrower is very important to the success of an application

There is no substitute for Genuine Savings, even if lenders don't require it as a matter of policy

A clean credit record, stability of employment whether PAYG or self employed, a few assets to show for the income, some savings etc

An application of mine which settled on Tuesday, when the Senior Credit Assessor of that lender rang me, she said that 'most applications aren't worth the paper they are written on' and was amazed that my customer actually had some assets, a good history, and some stability of address, employment and savings.

Borrowers can be their own worst enemy - a broker can do only so much to help groom the application. A couple of months getting everything in order raises the chances of success with an application many times over

But any sizeable percentage of defaults on mortgage loans, well I wonder where these borrowers are 'cos I haven't met any of them yet and in all this time, I have had only one customer come back to me (after Maternity Leave) and ask for a refinance to enable some debt consolidation ... and she had the sense to ask for a restructure before she got into difficulties, not after!

Cheers
Kristine

 

[BayView]

Hi everyone,

Absolutely sick to death of dealing with banks/mortgage brokers.

Not sure whether what I have been experiencing is just par for the course (as banks have you by the balls in many respects as far as service is concerned), or should I look to other institutions for next purchase.

Basically current bank (with whom i have just completed one refinance, and one purchase, looking for another refinance asap and another purchase in next 4-6 months), have no consideration for urgency (even when you have stressed there are large financial costs to you for every delay) and there are consistent descripancies between what is agreed and what is put forward (ie. Agreed on 90% lend, and get contract and they have noted a figure that is actually 89.95% lend (which is $1k less)...

Firstly: Any techniques to get a bank working more efficiently? How can you esculate things when you have gone through the broker channel, and the broker is not pushing things urgently enough? Does it have much pull when you treaten to pull the pin on the deal and look else where, or does the bank think "whatever, we are a bank and there are heaps of other customers looking to get our money"???

Secondly: When the bank makes these small "errors" in key figures, are they infact errors, or are they attempts to sneak small amendments through in their favour? Would you continue to deal with a bank in the future?

Furthermore, I get on well with my broker, and feel he works well with me, however sometimes I feel he is inflexible (flately said that it was not possible to get finance at anything else but clean 5% increments - ie. 85%, 90%, 95% etc). Have since found out that through same institution you can get any % loan in 1% increments!!!!!!!!!

Basically, I am trying to decide if the way my current broker/bank are operating is standard, as there is no point pulling the pin if the grass isn't even any greener???

What do you all think? How have you all been stuffed around before, and what is standard/tolerable?

Cheers, Jacob.

Yesterday I had to deliver a car back to a customer's house. When I got there, he was having a rather heated phone discussion with the NAB about settling his son's property sale (son was killed in car accident).

He continued to explain to me after the call how he was being stuffed around in the settlement, and was withdrawing all his (considerable) business from them and moving elsewhere.

I have dealt with all the Big 4, Bankwest, St.G and a coupla others over the years.

Have had problems with all of them in different areas - especially loans. One bank missed settlement 3 times in one transaction we did.

They are all a pain in the ar$e, but what makes the whole process smoother is being well prepared with paper work, records etc.

Banks are very cautious, and like people who can get their act together so to speak with their finances. A good MB also makes a big difference.

Most people by nature are lazy, and never have this area of their life in order. Let's face it; for most people bookwork and taxation etc is boring and complicated. So they avoid it until required.

My mentality is that if I keep constantly at the paperwork and keep good records, when it's time to get hold of some funds, or if it is needed quicker than sooner, my chances of the Banks saying yes are better and easier.

After all; the biggest corporations in the world are very good (usually) at their financial records and procedures; they have to be because they have to report back to shareholders and the Board every week with updates. We should follow their lead in this area.

 

[Bigtone]

Hi Bigtone

Which Bank just approved a $450,000 low doc cash out for a customer of mine

A subsidiary of the same bank just approved a major refinance - just shy of $1,000,000, with $100,000 uncontrolled cash out, and a purchase loan of nearly the same amount.

There seems to be a lot of rumours flying about, but being at the coal face as I am, my experience is that, as always, it is the quality of the application which wins the deal

The preparation of the borrower is very important to the success of an application

There is no substitute for Genuine Savings, even if lenders don't require it as a matter of policy

A clean credit record, stability of employment whether PAYG or self employed, a few assets to show for the income, some savings etc

An application of mine which settled on Tuesday, when the Senior Credit Assessor of that lender rang me, she said that 'most applications aren't worth the paper they are written on' and was amazed that my customer actually had some assets, a good history, and some stability of address, employment and savings.

Borrowers can be their own worst enemy - a broker can do only so much to help groom the application. A couple of months getting everything in order raises the chances of success with an application many times over

But any sizeable percentage of defaults on mortgage loans, well I wonder where these borrowers are 'cos I haven't met any of them yet and in all this time, I have had only one customer come back to me (after Maternity Leave) and ask for a refinance to enable some debt consolidation ... and she had the sense to ask for a restructure before she got into difficulties, not after!

Cheers
Kristine

Hi Kristine,

What LVR were those low doc deals? Did they involve LMI?

Cheers

 

[bcoombs]

Sorry Kristine but I just had a customer today that went to Which Bank. Three brothers existing, full doc, very good business returns, 4 properties freehold, one mortgage, one brother employment same place 32 years, the other in IT and been in same high income job 12 months. One credit card $3000, 8 new cars between them all paid for, $180,000 cash management account, plus paid $140,000 cash deposit, plus $170,000 in a business account. - declined because of $30,000 business credit card ( which is auto scrubbed every month)
No credit issues, no defaults, no judgments.

So they came to see me..... easy deal you would think? nope fails LMI credit score for non bank lender. So lowered LVR with cash to use ING.

This has not only been a waste of time, but a pathetic experience. And dont go onto me about quality of application, that's just ********. If applications were not a problem before that why are they now? Plus Which Bank have culled most of their brokers who didn't use them much, so to have the excuse its application quality...... ????!!!