Using the same bank for two IP??

Using the same bank for two IPs??

Hi,
We need some advice, and we have always found advice from this forum really helpful!
We are about to buy a PPOR and we have two IPs. WE have one IP with St George and one with Suncorp. We are going with NAB for the PPOR, as we can get an army loan through them. In order to not pay mortgage insurance and also to be able to borrow 100%, NAB are suggesting they take over the Suncorp loan. We will pay less interest with NAB and they are willing to pay for most of the payout fees.

Is this a good idea? We have read that it is good to go with different banks for all loans. Is this true?
 
To me, it doesn't sound like a good idea.

It sounds like NAB want to cross-securitise your PPOR with the IP financed by suncorp.

In my opinion, it's best to keep your loans separate, that doesn't necessarily mean each loan needs to be with a different lender, it just means that one property is the security for one loan.

Can you access equity in one of your IPs to use as a deposit on your PPOR? This may enable you to avoid paying LMI.

Cheers,

Jamie
 
Hiya

usually I like cross coll as much as a hol in the head : )

Be aware that the DEF loan subsidised rate wont apply to the investment portion ?


I personally would go for a NEW loan on one of the IPs which makes for the 20 % plus costs for the new PPOR and use the Def loan for the 80 % secured only to the new PPOR

Sure with xcoll you will def rates on the whole 100 % but is it worth it ?


ta
rolf
 
Thats a grr8 questions Sun

cross coll isnt a problem per se , till it becomes apparent that it is a problem.

Therein lies the challenge

I have had people discuss this for months and years, that its not a problem...............until they find themselves on the other side of the issue that the xcoll has created, and gee they switch camps reallly quickly, because all of a sudden its become relevant AND personal.

thesse can range from simple things like

1. U sell a property, u think u wll receive x from the sale. Lender has other ideas..........we revalued your portfolio, we are keeping the proceeds of that sale because some of ur other IPs came in shorter than u think.


2. I want to do a top up because I have renoed one of my properties and its now worth 50 k more. Issue is because you are crossed to x properties, you might not get access to that equity increase if all the property val.s dont come up to scratch.

Or more complicated things like

1. Lenders Mortgage Insurance premiums are calculated on the total aggregated exposure. 4 single loans to 95 % @ 295 k with ANZ might attract a total premium of 7200 a piece or 28 000 OUCH. 0r if all crossed te premium would be 56 k

2. because we take extra care on loans > than 1 mill, your chabe of approval is MUCH oower on marginal deals where its all wih one lender, rtaher than spread etc

etc x 20 more issues

There are some times where xcoll can be of greta benefit, but they are rare and specialised.

My usual response to most xcoll models is.......

Do you want to what is convenient or do what is right ?

ta
rolf
 
Thats a grr8 questions Sun

cross coll isnt a problem per se , till it becomes apparent that it is a problem.

Therein lies the challenge

I have had people discuss this for months and years, that its not a problem...............until they find themselves on the other side of the issue that the xcoll has created, and gee they switch camps reallly quickly, because all of a sudden its become relevant AND personal.

thesse can range from simple things like

1. U sell a property, u think u wll receive x from the sale. Lender has other ideas..........we revalued your portfolio, we are keeping the proceeds of that sale because some of ur other IPs came in shorter than u think.


2. I want to do a top up because I have renoed one of my properties and its now worth 50 k more. Issue is because you are crossed to x properties, you might not get access to that equity increase if all the property val.s dont come up to scratch.

Or more complicated things like

1. Lenders Mortgage Insurance premiums are calculated on the total aggregated exposure. 4 single loans to 95 % @ 295 k with ANZ might attract a total premium of 7200 a piece or 28 000 OUCH. 0r if all crossed te premium would be 56 k

2. because we take extra care on loans > than 1 mill, your chabe of approval is MUCH oower on marginal deals where its all wih one lender, rtaher than spread etc

etc x 20 more issues

There are some times where xcoll can be of greta benefit, but they are rare and specialised.

My usual response to most xcoll models is.......

Do you want to what is convenient or do what is right ?

ta
rolf

well explained rolf
 
thanks for the kind words BT

Many state that my type of position isnt right , and that xcolll is always the right way.

Thats ok, much of what we work with comes down to perspective.

Im pro xcoll where there is a demonstrated benefit to my client and OPPOSED where there is no such client benefit.

ta
rolf
 
We have two crossed and the bank would love to get their claws on the third - the third is currently AWOL and noone has any idea where the title is so until it turns up it is a non-issue.

Crossing sounds like such a pain we're aiming to have the third loan completely separate with another bank. When the title eventually turns up.
 
Im pro xcoll where there is a demonstrated benefit to my client and OPPOSED where there is no such client benefit.

I agree. I've always said that xcoll is a tool and has it's uses. The screwdriver is a great tool, but not much use when you want to drive a nail or drill a hole.
I've got 5 properties with stand alone loans with a variety of lenders. I also have 2 properties xcoll. That was by design and served a useful purpose at the time.
I'm about to refinance them and will split them as xcoll no longer gives me a greater benefit than stand alone loans. If one bank won't take them both, then I'll put each with a different bank. Job done.
 
thanks Rolf.

Thats a grr8 questions Sun

cross coll isnt a problem per se , till it becomes apparent that it is a problem.

Therein lies the challenge

I have had people discuss this for months and years, that its not a problem...............until they find themselves on the other side of the issue that the xcoll has created, and gee they switch camps reallly quickly, because all of a sudden its become relevant AND personal.

thesse can range from simple things like

1. U sell a property, u think u wll receive x from the sale. Lender has other ideas..........we revalued your portfolio, we are keeping the proceeds of that sale because some of ur other IPs came in shorter than u think.
Been there.
2. I want to do a top up because I have renoed one of my properties and its now worth 50 k more. Issue is because you are crossed to x properties, you might not get access to that equity increase if all the property val.s dont come up to scratch.
Done that.
Or more complicated things like

1. Lenders Mortgage Insurance premiums are calculated on the total aggregated exposure. 4 single loans to 95 % @ 295 k with ANZ might attract a total premium of 7200 a piece or 28 000 OUCH. 0r if all crossed te premium would be 56 k
Oooh, haven't hit THAT one yet.
2. because we take extra care on loans > than 1 mill, your chabe of approval is MUCH oower on marginal deals where its all wih one lender, rtaher than spread etc
Abso-[insert favourite swear word here]-lutely!
etc x 20 more issues

There are some times where xcoll can be of greta benefit, but they are rare and specialised.

My usual response to most xcoll models is.......

Do you want to what is convenient or do what is right ?

ta
rolf

Exactly as Rolf suggested, x-coll isn't a problem, until it is. And you (generally) have no control over when it is.
 
Yup, and all the other stuff is too, only i was being conservative si I dnt get accused of scare mongering :)

dont forget to add stamp duty

ta
rolf
 

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1. U sell a property, u think u wll receive x from the sale. Lender has other ideas..........we revalued your portfolio, we are keeping the proceeds of that sale because some of ur other IPs came in shorter than u think.

Yes had this happen when I was working at Westpac, had my loans with them and sold a property and thought I would get x amount, which I did but WBC had other ideas about having access to the funds.

So my plans had to change.

You live and learn..
 
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