Different banks vs same bank for all properties

Hi All,
I'm new investor and am reading this forum for the last 2 months. Thanks to all the contributors. My situation is:
A PPOR loan with ANZ, an IP loan with CBA and going to buy another IP with a loan from Westpac. All small properties.
My question is what are the pros and cons of having same lender for all the IPs? Is it easy to deal with single lender? Do they provide discounts in initial loan fees if having a multiple loans?
 
Do they provide discounts in initial loan fees if having a multiple loans?

There may be some leverage you can apply re fees and interest rates if you have a larger amount with them.

On the other hand, each bank has a ceiling limit at which they stop lending you any more.

Cheers,

The Y-man
 
Each of these lenders have a professional package which would incorporate each of your loans under a single package fee.

If you're borrowing a reasonable amount of money (say $700k or more) then lenders will be more negotiable on their rates. Keeping track of your accounts is also simpler.

On the flip side putting everything with one lender has serious disadvantages for an active investor. In lots of different ways, lenders can take control of your finances and perhaps put you into a position where you can't move forward because they're not comfortable with it.

An example of this is that a friend had several properties with a single lender. She sold a property because it wasn't meeting her needs and the cash released by the sale would go towards a development project. After the sale the bank decided that they're prefer for her to pay down her home loan with the funds despite that her plans were clearly within their policy. In the end she had to move her entire portfolio to other lenders (at significant expense) to proceed with the development.

This is a question which can go either way depending on what your circumstances and plans are.
 
Hiya San

Welcome

How longs a piece of string.

Comes down to a variety of factors,, probably the most imoortant one being is the amount of exposure. If you only have a few hundred k, and your service model

If you have 10 mills of loans its going to be very hard to have them spread amongs lenders

ta
rolf
 
Thanks for the reply.
My PPOR is worth 178k with a loan of 166K from ANZ. The first IP is worth 236K with a loan of 228K from CBA. The second IP is worth 146K with a loan of 131K from Westpac.
My earnings are 100K before taxes.
At present no cash........so no buying for the next 2 yrs. how do I take the leverage of potential equity in future with different banks?
 
Sounds to me like equity / deposit is going to be your next stumbling block with a new lender.

Might be forced to go back one of the previous lenders (with the exception of Anz) and go cap in hand and offer to cross collateralise the securities in exchange for a new valuation and 95% lend.

Even then going to be a tough gig with stamp duty, acqusition costs and of course good old LMI to take into consideration.

Might be a time to take hold and save a few dollars in your Anz offset account.
 
My PPOR is worth 178k with a loan of 166K from ANZ. The first IP is worth 236K with a loan of 228K from CBA. The second IP is worth 146K with a loan of 131K from Westpac.
My earnings are 100K before taxes.
At present no cash.....

Could be time to sit back for a wee while, tell Westpac that you've had a re-think, and use that large income of yours to sock away some cash and get firstly a cash buffer happening, and secondly some equity in one of them....probably the PPoR. :confused:
 
I think I will try to save money and put it into my PPOR loan account for the next 2 yrs. And then will try to buy another IP with 80% LVR (no LMI).
How does it sound?
On the other hand, it looks like if I get a 95%LVR loan now and buy another IP, it will generate equity more than the LMI I am going to pay now.

Which option is good?
 
Welcome sanjayag,

It depends what you are comfortable with.

Some people would rather pay LMI fees now and reap the rewards of capital growth sooner rather than later. As you mention, you predict your growth will outweigh your LMI in the next two years.

What do you feel comfortable doing?

If you won't sleep at night wondering if you have missed out on opportunites to make money....then buy now.

If you won't sleep at night worrying about all the LMI , fees and whether you will recoup your costs.....don't buy now.

The answer rests on your strategy, your risk profile and what you are ready to do in order to get ahead.:D

Regards JO
 
Hi all, I have the reverse issue where I have 3 loans with the same bank, CBA.

My current LVR with them is about 80% but this does not take into account a large sum in an offset account.

I want to buy again. But I'm not sure if i should find a new lender or not, regardless of whether the CBA are prepared to loan me more money.

All loans are crossed, but I"m in the process of refinancing so that they will all be standalone loans.

Without any more equity to play with, I assume I have no choice but to use some offset funds to pay the 20% deposit, or pay LMI.

Can any of you mortgage brokers offer any tidy solutions here? And also any opinions on going for round 4 with CBA, i.e. should you borrow up to your "ceiling" (whatever that may be) and then find another lender? Or does it not really matter? I assume in the case above where the bank forced the customer to pay down debts with proceeds from a sale, that was because the loans were crossed? Could they do it otherwise?

Thanks,
Gooram
 
Hiya Goo

If you still have PPOR debt, then put a loan split into the PPOR loan equal to the amount of deposit that you want to use for the new PPOR. The pay it down with cash from the offset and re borrow when needed for the new IP. That way u max the tax posn.

There is no vanilla answer to your q, but in general I dont like fully exhausting one lender b4 moving on to the next best serviceability model.

ta
rolf
 
Hiya Goo

If you still have PPOR debt, then put a loan split into the PPOR loan equal to the amount of deposit that you want to use for the new PPOR. The pay it down with cash from the offset and re borrow when needed for the new IP. That way u max the tax posn.

There is no vanilla answer to your q, but in general I dont like fully exhausting one lender b4 moving on to the next best serviceability model.

ta
rolf

Hi Rolf,

I understood everything except the "loan split". Basically I would be paying the deposit from the offset into the PPOR loan then redrawing it so I can claim deductions. Could I not just use a redraw facility? I.e. pay it down and redraw?

Anyway can you maybe explain the loan split in more detail?

Thanks.
 
Personally I wouldn't put things right to the limit with a lender before moving, better off to stay ahead of this limit by a reasonable margin.

If you're going to push serviceability with a lender, then buy the next property through another lender, you may find yourself handcuffed because the first lender won't allow a small increase for a deposit for the next property.

In another scenario, you might refinance a property to a second lender before purchasing to access equity. The first lender may refuse to release the property because they can see from your credit report, you're replacing it with a loan that is outside their comfort zone.
 
Hi Gooram

Pay down and redraw PPOR loan will cause headaches for accounts

if you can provide the relevant loan and purchase figures once of us can give you an example with actual numbers

ta
rolf
 
Hi Gooram

Pay down and redraw PPOR loan will cause headaches for accounts

if you can provide the relevant loan and purchase figures once of us can give you an example with actual numbers

ta
rolf

Rolf,

In the interest of keeping my gory details somewhat private, I've PM'd you.

Thanks
Gooram
 
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