Refinance Time

From: Anthony C


Hi All,

My bank has just said my next residential property investment will only be approved as a Business commercial loan, and not as a investment home loan. This will add a whole one percent on the rate for nothing. I told them to organise a payout figure for the lot cause you guys are P!@#!$ and I'm moving on. Then they said let me speak to the state manager , blah bla.....

So Anyhoo, Looking at refinancing a portfolio or part of, Anyone know of a "NAB Investors Choice Package" representative in Melbourne that they can recommend. Or any other good bank manager lenders. If you don't want to give numbers out on the forum you can contact me directly on "achesna@rocketmail.com"

P.S. Guess which bank I'm getting out of..
P.P.S Great time to be refinancing

Ta.

 
Last edited by a moderator:
Reply: 1
From: Rolf Latham


Anthony

Suggest you find yourself a good broker. Let them do the leg work for you so that you only have to chase a short list ?

Sad that your existing lender is willing to let you go that easily - so much for business retention !


Rolf
 
Last edited by a moderator:
W

WebBoard

Guest
Reply: 1.1
From: Donna Larcos


I'm interested - are you with NAB now? Do
you have more than three or four property
loans with them? I remember attending a
seminar once where the fellow said there
is bank resistance once you get up to
three or four properties because they feel
the risk is accelerating at that point and
you may have to go to another lender.
(Funny, I thought the more you owned the
more your risk would be decelerating but
that's just me). I'm with NAB Investor's
choice with two fixed interest only loans
and a P & I home loan and the difference
in interest rate is only 0.10% So far
they've lent me $600,000 which is not bad
seeing my husband's a part-time student
and on paper we don't earn much. Now
when I appear at the door they just laugh
and say "How much this time?"

The irony is that the better you structure
your affairs the more suspicious they are
of you. We have a family trust set-up and
some of our income goes into that. I
recently had fun applying for a $5000
increase in a credit card limit. I told them
our assets and liabilities and income and
they said they wouldn't count the trust only
our salaries!! I said in that case we earn
less than $40,000 p.a. But your loan
repayments are more than you earn!
Doesn't make any sense does it - I said.
But they still refused the increase. You
have to laugh .

Enough of my ramblings.
 
Last edited by a moderator:
Reply: 2
From: Marina. L


Hi Ant,
Sorry to hear your dilemma, but as you know the banks do make it awfully hard for the average person. You recall the problems we were having and yes you came to our rescue and it all worked out.
Is this B---- from the C-- that you are having problems with?

Could you clarify for me why is it that they are pushing the commercial loan issue. I thought commercial was just for commercial properties. Yours are all residential.Right?

What is even more confusing is that my brother-in-law bought a hairdressing shop and he was given a residential loan because the rates were cheaper.

I will find out who he is going through.

One thing I have learnt and read and it works for me , do not let one bank have all your properties. Access your equity from your line of credit and use that as a deposit for your new Ip with a New Bank.



MARINA
 
Last edited by a moderator:

Sim

Administrator
Reply: 2.1
From: Sim' Hampel


Is it possible that by giving you a commercial loan they get around some of the implications of the comsumer credit code and thereby perhaps removing some of their risk ? (at the expense of increasing yours ?)

I don't know the answer myself... someone like Rolf might be able to shed a little more light on that subject.

 
Last edited:
Refinance Time More

Reply: 1.1.1
From: Anthony C


Thats Hilarious,

Sounds like you still going ok so far, well done. I not with the NAB, but would like to see what they have to offer. Is your NAB person available for another possible portfolio.

With my bank, I get no loan fees and .15% off all advertised rates. So I'm looking at 6.45% for 5 years fixed and Interest Only. Anyone got better than this so far?

I also heard of a birdie on the inside from a credit union, that once you go over 5 IP's you go over a risk threshold. They now view your portfolio as an business, and will only lend money at the higher commercial/business rates to cover their conservative bums. Anyone come across this?

My $#!^ bank also only counts 70% of my rental income, someone ages ago in the forum said their bank counted 100% of rent income when calculating DSR, think it was NAB. Anyone else getting this?

Ta



 
Last edited by a moderator:
W

WebBoard

Guest
Refinance Time More

Reply: 1.1.1.1
From: Keith J


CommBank are offering 6.6% 5yr fixed I/O. You can pay $300pa and get no app fees or monthly charges and 0.25% off the fixed rate making it 6.35%.

CommBank count 70% of rental income, but that is counted as paying off the interest. Some other banks count 100% of it as additional income and add it to salary, and then count 35% of the lot.
 
Last edited by a moderator:
Reply: 2.2
From: Anthony C


Hiya Marina,
Hows things?,
Yes Same Bank,
Our banker B---- has been great and been bending over backwards to help us out, even his immediate boss has approved our requests. However, the state/national manager has pulled the plug and has approved, but only as a business loan. Reason: They say its a DSR risk issue.

The loan I am seeking is for a two bedroom flat in an inner city suburb of Melbourne. Looks like residential to me.

Will definitely be looking at spreading my loans now. Loyalty will get you no where.

Now where having fun.
Its like Monopoly for Grownups.
Luv It.
Cheers
Ant.

P.S. My Birthday today, and I'll celebrating one way or another, finance approval or not.


 
Last edited by a moderator:
Refinance Time More

Reply: 1.1.1.1.1
From: Anthony C


Thats who I'm with,
Are you getting .25% off? They are only giving me 0.15% through the same $300/year Addvantage Package, can you double check that, have you got that in writing?
Regards
Ant.


 
Last edited by a moderator:
Reply: 2.1.1
From: Anthony C


Hiya Sim,
That's the 3rd time I've heard the Consumer credit code mentioned in two days. Is it about Risk thresholds (45%DSR), IP numbers (6), Borrowing amounts (1 Mil). what?
Anyone clarify?


 
Last edited by a moderator:
Reply: 2.1.1.1
From: Rolf Latham


Hi Anthony


The consumer Credit code is a national standard for lending for "predominantly private purposes to individuals.

When you apply to a lender they will ask you to sign a declaration of purpose indicating whether the loan is mainly for investment purposes.

If the loan is for more than 50 % investment use (residential or otherwise), then the consumer credit code does not apply.

The consumer credit code has been designed to protect private borrowers (or strata corporations ~ body corporates. The regulations covering such loans are more protectiev to those borrowers than investors.

The main emphasis of the code is to provide clients with full and accurate disclosure of all particlars relevant to their credit contract for non investment loans only.

In regard to your particular situation, your lender has just developed cold feet.

Up to 500 k with most lenders are no dramas.

Beyond 500 borrowings of any sort, more rigorous checks apply, and beyond 750 you may be asked to lower LVRs.Beyond 1 mill you will usually get a private banker but most
lenders will move you to commercial business because you are now an increased risk.

Increased risk not as a statement of fact, but based on statistical data the risk they carry is greater with large volues of loans, than smaller.

What can you do ?

1. Get yourself a broker and/or;

2. Leave your existing biz where it is and look elsewhere for new. Much less hassle than taking it all with you and/or

3. Do what you are considering and move the lot to one or preferably a couple of institutions and/or

Although it is easy to say, one should not take these rejections personally. They are not bouncing you or your business per say, they are just too black and white outside of certain guidelines.

Ta

Rolf
 
Last edited by a moderator:
W

WebBoard

Guest
Reply: 2.1.2
From: Gary Plotzza


Hi Sim,
You are only covered by the consumer code if the loan is wholly or predominantly for personal,houeshold and domestic purposes.

Loans for investment are not covered by the code.
So having a residential or commercial loan would not come into it.

Hope this helps.

Gary p, Flexible Mortgages flexihl@hotmail.com
 
Last edited by a moderator:
Refinance Time Happy Ending

Reply: 2.2.1
From: Anthony C


Guess What
Got a call 5pm Friday, "Sorry about the delay in getting back to you sir, we have your home investment loan approved and don't worry about the commercial/business loan thing it was a mistake."


 
Last edited by a moderator:
W

WebBoard

Guest
"Refinance Time,Thanks Rolf"

Reply: 3
From: Jack Moro


Hi all,

This thread could not have come at a better time for me. I am in battle with financiers
at the moment for the very best deal (though only for my fist I.P.)

I am currently with Which Bank (Primary residence) they are offering me a deal
(6.85%, Fixed 5yrs,no establishment cost etc for the I.P) not as good as I have seen here so I shall squeeze them again.

Has anyone had experience with StGeorge Portfolio loan this is recommended by my broker.

Though the deal (6.9% Fixed 5 yrs $400 establishment) is not quite as good as Which Banks as I would have a pay out figure to Which Bank as well, if jumping to St George etc.

Broker claims St George a superior product e.g..g
I would avoid some of the problems mentioned above. That being when you purchase in excess of 4 or so properties as the Portfolio loan caters for up to 10 sub accounts, or one account for each I.P up to 10 I.Ps

Any feed back on the St George product would be appreciated

Q1. Is St George a superior product compared to Which Bank or NAB for property investment anticipating purchasing in excess 5 properties.

Q2. If it is, Is the extra cost worth it

Q3. My Broker claims the rate is not negotiable but I believe everything is negotiable in life. Does anyone know of how I can squeeze them down.

Q4. Is it likely my broker is only steering me to St George as they may offer him a better commission than other financiers??????

Cheers
Jack
 
Last edited by a moderator:
Refinance Time Happy Ending

Reply: 2.2.1.1
From: Rolf Latham


Hi Anthony

Ecxcellent !

Still, get yourself a broker for the future hassles - be pre-emptive. You never know what might be on offer.

Ta

Rolf
 
Last edited by a moderator:
Reply: 3.1
From: Rolf Latham


Hi Jack


Q1. Yes and no depends on what other products you may qualify for and if you have a "home Loan" as well. Why are you looking to fix for 5 years when rates are on a downward trend (Im not suggesting though that 5 year fixed rates will mpve much) ?

Depending on your qual criteria you can get a variable line of credit at less than 6.95 %, so why fix now ?

Q2. No, there are always cheaper ways to put loans together than the LOC option. Portfolio is a great flexible product, just a little pricey, compared to other options

Q3. Rates are negotiable to a small degree, but only over 500 to 1 mill. Although, clients of mine have managed to get reduced rates on less volume.This applies more when lenders want to hold their business rather than gain it.

Q4. St George pay essentially the same amount of commission as most other lenders. Your broker should disclose this to you in any case so that you can make an informed decision, and should clearly present two or three options if he/she is truly independent.

Commbank and NAB do generally not pay brokers comms, although NAB will pay for new biz, but much smaller amountsthan STG.

Hope this helps you a little.
Ta

Rolf

If you would like further info please email me





Rolf
 
Last edited by a moderator:
Refinance Time More

Reply: 1.1.1.1.1.1
From: Marina. L


Hi Ant,
I negotiated 0.25% off below but without a $300 annual fee. I figured I do not need all the associated frills and all I pay is the $8 per month charge.



MARINA
 
Last edited by a moderator:
Refinance Time Happy Ending

Reply: 2.2.1.2
From: Marina. L


Hi Ant,

Happy Bithday for yesterday and congratulations on the final verdict.
They sure did make you sweat it out.

Do you mind telling us the details of your purchase.Where, price, rental



MARINA
 
Last edited by a moderator:
Reply: 3.1.1
From: GoAnna !


Ant

Do you get .5% off standard variable as you should on ADDvantage?

Anna
 
Last edited by a moderator:
Top