PPOR loan to IO

[bdaniel79]

hi all

First post, yippee?!

I have a PPOR loan of $452k, current home value c$530k. I took a 3 year fixed rate loan with ANZ last September at 4.99%, no offset it was a fairly basic product (I think...).

I'm looking at trying to have this as IO & offset with a view of existing PPOR going to IP next year and also would like to draw some equity.

any tips would be awesome. Is it better if I approach ANZ myself or a broker?

cheers

 

[Jamie M]

Hiya

Is it under the breakfree package?

Previously changing from P&I to IO was deemed credit critical and a whole new app needed to be submitted. They've made some changes which are attempting to rectify that issue - but I'm not sure how the fixed loan is going to come into play.

Might be easiest to give them a buzz directly.

Cheers

Jamie

 

[bdaniel79]

Hiya

Is it under the breakfree package?

Previously changing from P&I to IO was deemed credit critical and a whole new app needed to be submitted. They've made some changes which are attempting to rectify that issue - but I'm not sure how the fixed loan is going to come into play.

Might be easiest to give them a buzz directly.

Cheers

Jamie

Hi Jaime

It's on the breakfree package, the recent annual fee reminded me to look at the loan..

cheers

 

[Shahin_Afarin]

The thing with ANZ is that you can only have one free offset and then they charge you $10 per month for additional offset which is very silly.

Just make sure that the equity release is a separate facility and you are not doing a topup of the existing loan.

I think you should contact your broker as it should be set up correctly and thats is why brokers get paid to do anyway.

 

[Peter_Tersteeg]

The biggest problem we consistently face with the ANZ is that they are ultra conservative in the amount of money they'll lend to property investors with multiple properties. They view existing debts far more conservatively than quite a few other lenders which means you can find yourself in a position where some lenders will give you mountains of money and ANZ won't give you a cent. Some people can get a modest amount done with ANZ, some can't get much at all.

As a result, the challenge is that when you deal directly with the ANZ branch, they will ask why you want to access your equity. When you explain that you'd like to purchase more property, they will model the new purchasing scenario. If it doesn't work, you could find yourself having a lot of trouble accessing the equity even if you intend to purchase through another lender.

When you deal directly with a lender, they can only offer you their own products and policies. Odds are they won't even know what their competitors can do. A far better solution is to work with a broker who understands your longer term goals and works with you to put together a lending strategy that meets those goals. This may be with a single lender, or it may be with multiple lenders.

Having goals and strategy is very important, and you need to be purchasing the right properties to achieve those outcomes. This is critical. The other critical factor is getting the finance right to ensure you can actually purchase those properties.

 

[bdaniel79]

My broker has advised that ANZ would charge around $3,200 if I was to go to IO and then I have to 'renegotiate' the loan terms...

I feel as though I would have more luck walking into the branch across from my office and speaking to the manager who assisted with loan docs last year, anyone agree??

 

[Terry_w]

My broker has advised that ANZ would charge around $3,200 if I was to go to IO and then I have to 'renegotiate' the loan terms...

I feel as though I would have more luck walking into the branch across from my office and speaking to the manager who assisted with loan docs last year, anyone agree??

fixed loan = break cost. Even changing from PI to IO.
But it could be negotiatable. I have never tried something like this.

 

[Rolf Latham]

I recall CBA dont break the loan to move from PI to IO

any lender that does push break costs are possibly into thievery

The interest component is on sold, not the principal

ta
rolf

 

[s0805]

The thing with ANZ is that you can only have one free offset and then they charge you $10 per month for additional offset which is very silly.

.

Is this negotiable?

 

[Terry_w]

.

Is this negotiable?

Everything is, but you would find it easier to get a rate reduction than a waiver of an account fee.

 

[Shahin_Afarin]

.

Is this negotiable?

Nope unless you have gargantuan (I want to use one big word a week) borrowings.

 

[Jamie M]

Nope unless you have gargantuan (I want to use one big word a week) borrowings.

Agree with Shahin - not something they generally move on unless your staff.

Cheers

Jamie