new loan

[gavins1]

Hi, just been to the broker, he recommended homeside, then switched to no fee CBA loan when we said we would like pre approval, he has recommended incorporating our $30K car loan into the new loan so we can borrow more, we have another investment property with westpac- which of course he wants to refinance and he said we can pay mortgage insurance on our current- lower value property instead of paying the higher amount on the new property .
my wife is the one applying for the loan, as Im the stay at home dad at the moment, he said the banks he recommended are more sympathetic to our situation. I dont like the CBA loan as there is no offset or anything like that.
Does this all sound about right - about what he is telling us?

 

[Peter_Tersteeg]

I don't know anything about your financial situation so it's difficult to determine if what's being recommended is optimal or not. The CBAs no fee home loan does tend to work well as a basic loan when the amount is fairly small, but as you've indiciated, offset accounts are useful and there are alternatives that give you all this at a similar price. If you are going to refinance your Westpac loan I'd suggest that the no fee home loan is probably not the optimal solution give the total lending is probably going to be more than $250k.

Personally I'm not a big fan of refinancing car loans. It makes financial sense given that it improves your cashflow, but it can turn a 5 year debt into a 30 year debt which costs far more in the long run. You can be paying for the car long after it's a rusty smear at the scrap yard. I've often found a workable solution to be to get the car loan onto home loan rates, but with an accellerated repayment schedule. This can deliver the best of both cashflow and avoid a long term loan.

It does seem that the broker is trying to refinance pretty much everything you have. That's fine if there's a solid financial benefit to yourself, but there's also plenty of brokers and bankers who do this simply to get their figures up higher. What you're saying seems to be a very ad-hoc approach to loan structuring, rather than goal or outcome oriented.

Make sure your avoid mixing up investment and personal debt, and avoid cross collateralisation at all costs. If the broker brushes off these issues or can't clearly demonstrate how they'll go about this, definitely move on.

 

[Brady]

Hi, just been to the broker, he recommended homeside, then switched to no fee CBA loan when we said we would like pre approval, he has recommended incorporating our $30K car loan into the new loan so we can borrow more, we have another investment property with westpac- which of course he wants to refinance and he said we can pay mortgage insurance on our current- lower value property instead of paying the higher amount on the new property .
my wife is the one applying for the loan, as Im the stay at home dad at the moment, he said the banks he recommended are more sympathetic to our situation. I dont like the CBA loan as there is no offset or anything like that.
Does this all sound about right - about what he is telling us?

What is the new loan for?

Are you refinancing an existing loan or purchasing new property?

What is the purpose of the new loan?

Why would the broker suggest No Fee Home Loan if you want to have an offset account?

If you care to share some more details? What is your current loan balance? What is your existing property worth?

 

[Rolf Latham]

rather odd "switch" from a number of perspectives, most of all a structured lending approach and secondly the product differences.

either your brief to the broker is too brief, or they havent asked enough questions

ta
rolf

 

[Shahin_Afarin]

I would be getting a second opinion and weighing that up with the recommendation provided.

What is the LVR? I assume its well below 80%?

 

[Jamie M]

Hi, just been to the broker, he recommended homeside, then switched to no fee CBA loan when we said we would like pre approval, he has recommended incorporating our $30K car loan into the new loan so we can borrow more, we have another investment property with westpac- which of course he wants to refinance and he said we can pay mortgage insurance on our current- lower value property instead of paying the higher amount on the new property .
my wife is the one applying for the loan, as Im the stay at home dad at the moment, he said the banks he recommended are more sympathetic to our situation. I dont like the CBA loan as there is no offset or anything like that.
Does this all sound about right - about what he is telling us?

The HSL and CBA no fee loan are chalk and cheese - what was the reason behind the switch in recommendation?

There's also a big difference between the two when it comes to determining borrowing capacity. CBA is less generous compared to HSL - so if it only services with CBA via incorporating your car loan, it might service with HSL without it.

If you do incorporate the car loan, I'd consider what Pete mentioned and pay it off over a shorter term than a regular home loan so you don't end up paying a lot more in the long run. Make sure it's all set-up properly so personal and investment debt is distinguishable.

Cheers

Jamie

 

[Aaron_C]

We know nothing about your situation....although I don't really like it when people get fickle with their recommendations since it shows the original recommendation has no weight.