Major lenders vs non-major lenders when having savings


I’ve been saving for a while and now I’d like to start investing in properties. My plan is to ask for a 90% LVR loan for my first property because in this way I should still have some cash remaining for another 90% loan in the near future and be able to get a second property.

So, being myself and my partner both full docs and having enough genuine savingsis there any point on dealing with non-major lenders?

I want an offset account, so RAMS is out of the equation, but how about for instance FirstMac?

My understanding after reading through several threads in this forum is that non-major lenders might be your option if you want a 95% LVR loan or you are a low doc (or both!).

Is there any other advantage that could be relevant in my case? Is it for instance easier to get your equity out once the value of your property has grown?

Regarding cross-coll, for what I’ve read here, with the big banks it is possible to avoid having properties cross-collaterised if you define the right structures. Is there any difference in this regard between major lenders and non-major lenders?

Hi Micasa

Rather than a 90% lend why not consider a 95% lvr.

Yes a rare beast these days I admit but still doable. Interest only with 100% offset would suit you even better. Dont think you will find too many non banking lenders offer such a product.

Firstmac does not offer a true offset account so whilst the fixed rate is attractive for year 1 dont think it will operate in the same way as a traditional offset account.

No reason if structured correctly why the loan needs to be cross collateralised.
Thanks Richard/Rolf.

Looks like there is no big difference (apart from the numbers) between the big and the small fish, then.

Regarding going 95%... I think it is not worth paying that extra LMI right now and looks like since no many lenders offer it, the final product might be more expensive.

Maybe for the second property I consider it, but for a newbie sounds a bit of a big step at the moment.