Genworth rejecting NRAS refinance

[antiparadox]

Was trying to refinance my NRAS townhouse with Resimac and all was going well until the final hurdle - was told a couple nights ago by Resimac that their reinsurer Genworth have changed their policy to now reject all NRAS refinance applications (see link).. !!
http://www.genworth.com.au/underwriting-policy/underwriting-policy/5.10-loan-purpose

Anyone know of a lender not reinsuring with Genworth that will take NRAS refinance?

Edit: I'm not into LMI territory - looking only at refinancing loan at 75% LVR.

 

[Aaron_C]

Oh dear. Best try a bank lender who doesn't need all their loans mortgage insured. Possible one is St George (if you dare)!

 

[Rolf Latham]

nothing new

while NRAS has its great benefits some things that you need to be concerned about are refinancing to leapfrog, on a number of reasons and not just lender views.

This has been a concern from day one, but there are ways around it if the valuations stack up.

Like all niches, if you are going to use a niche to get ahead, you need to know it inside and out.

Thanks

Rolf

 

[Kiwibaz]

If you are refinancing a NRAS property do you even need to tell them is NRAS?

 

[Rolf Latham]

If you are refinancing a NRAS property do you even need to tell them is NRAS?

the valuers get wind pretty quick

In addition, leaving out material information such as that could be construed as being a bit naughty

ta

rolf

 

[Rolf Latham]

BTW

hada long chat with a Genworth fella over this.

Nothing too way out.

Refi's are a high risk to them anyways, and addinga further layer of risk with NRAS is a no no until the stock type proves itself or otherwise.

I guess there is an element of "restricted security" in this style of product which limits a quick sale in the case of obtaining possession.

ta
rolf

 

[Mick C]

go with a lender that doesn't insurer up to 80% NRAS- ANZ, St George....

 

[Kiwibaz]

I know we are moving from the realms of logic to 'bank land' but surely given that you can opt out of NRAS when ever you want, the property is no different to one next door thats not NRAS. I don't see how if you have the serviceability to cover the loan that just because its being rented 20% below market rate some how is becomes a risky loan.

I recently purchased 2 of them (274k, 180pw and 315k, 280pw)and had problems with getting LMI even with a combined income of 320k. Go figure

 

[Aaron_C]

I recently purchased 2 of them (274k, 180pw and 315k, 280pw)and had problems with getting LMI even with a combined income of 320k. Go figure

Kiwi - it is the security that's the issue. Income is irrelevant.

 

[Rolf Latham]

I know we are moving from the realms of logic to 'bank land' but surely given that you can opt out of NRAS when ever you want, the property is no different to one next door thats not NRAS. I don't see how if you have the serviceability to cover the loan that just because its being rented 20% below market rate some how is becomes a risky loan.

I recently purchased 2 of them (274k, 180pw and 315k, 280pw)and had problems with getting LMI even with a combined income of 320k. Go figure

if your places are duplexes or stand alone homes, or a unit where only a small proportion ( <10 % is NRAS) then when you dump the entitlement (that you have paid some form of premium for ) then in theory your place is no longer a restricted security.

BUT, while there are many properties with such an entitlement in your immediate area or development, then the mortgage insurer may have an issue.

Add to that the propensity for the marketers to specifically chase buyers that arent 100 % savvy to the pros and cons of investing in IP generally, I can clearly see why some LMI providers see a potential risk.

ta

rolf