Westpac 85% no Lmi from 27/2/6
- Thread starter Mr Ed
- Start date
Spoke to someone at Westpac about this product.....
1. Will not be available through brokers
2. Will not be advertised.....
It should be interesting to see if any other lenders out there follow suit.....
1. Will not be available through brokers
2. Will not be advertised.....
It should be interesting to see if any other lenders out there follow suit.....
Really :O)
Better speak with someone that has a better knowledge - I love the rumour mill.........................
Still not policy and wont be for a while. Loans are being approved at that level without LMI as I write this through the third party channel.
The challenge with any lender going direct channel only with a policy or product is two fold. Its revenue neutral at best, and in many states it would contravene the trade practices act.
ta
rolf
Better speak with someone that has a better knowledge - I love the rumour mill.........................
Still not policy and wont be for a while. Loans are being approved at that level without LMI as I write this through the third party channel.
The challenge with any lender going direct channel only with a policy or product is two fold. Its revenue neutral at best, and in many states it would contravene the trade practices act.
ta
rolf
The person I spoke to, is the person who actually developed the product........
So... it's not from the "rumour mill" as you so nicely put it......
It's about to be squared away today......
Applications have already been taken for it......
From what you know, who else is doing 85% non lmi lends ? and at what % rate ?
Cheers
So... it's not from the "rumour mill" as you so nicely put it......
It's about to be squared away today......
Applications have already been taken for it......
From what you know, who else is doing 85% non lmi lends ? and at what % rate ?
Cheers
Hiya
Legal and marketing, direct and third party will see a level playing field, IF and when the policy is finalised, while there may not be a "formal" third party channel policy, both legal and common sense commercial consideration will prevail. Because as you ask, who else is doing it, you will find which bank stepping up to the plate, its a competitive world out there.
Loans have already been approved with WBC above 80 through both channels :O), not just applns in.............
My understanding is that its not a product, "simply" a policy extension of what has been around for along time on a case by case basis.
ta
rolf
Legal and marketing, direct and third party will see a level playing field, IF and when the policy is finalised, while there may not be a "formal" third party channel policy, both legal and common sense commercial consideration will prevail. Because as you ask, who else is doing it, you will find which bank stepping up to the plate, its a competitive world out there.
Loans have already been approved with WBC above 80 through both channels :O), not just applns in.............
My understanding is that its not a product, "simply" a policy extension of what has been around for along time on a case by case basis.
ta
rolf
Hi DOR
Private banking ...........................not special :O)
ta
rolf
Private banking ...........................not special :O)
ta
rolf
Hello All,
Alright i am a bit lost. So we are saying that some lenders are already offering certain clients 85% mortgages without having to pay for Lenders Mortgage Insurance. And it is possible that this practice might become something advertised now in certain banks.
Would this be for IPs only or PPORs too. And would you have to pay a higher interest rate for the pleasure
Alright i am a bit lost. So we are saying that some lenders are already offering certain clients 85% mortgages without having to pay for Lenders Mortgage Insurance. And it is possible that this practice might become something advertised now in certain banks.
Would this be for IPs only or PPORs too. And would you have to pay a higher interest rate for the pleasure
Mal P,
The Lmi % is calc'd against the Net Amount Financed (NAF) as a %. So to answer your question...
@ 86% LVR is .75% of the NAF < $300k
@ 95% LVR is 1.71% of the NAF < $300k
Higher the LVR & higher the NAF then higer the premium.
Example if you were borrowing bettween $500 - $750k @ 97% then it would be 3.23%.
You need to add stamp duty on top of the premium as well.
Assume that helps ?
The Lmi % is calc'd against the Net Amount Financed (NAF) as a %. So to answer your question...
@ 86% LVR is .75% of the NAF < $300k
@ 95% LVR is 1.71% of the NAF < $300k
Higher the LVR & higher the NAF then higer the premium.
Example if you were borrowing bettween $500 - $750k @ 97% then it would be 3.23%.
You need to add stamp duty on top of the premium as well.
Assume that helps ?
Hiya Leandro
In a lot of ways, this has already been around on an exception basis. of the deal is strong for a number of reasons, they may waive the MI but with a number of restrictions.
For eg, with homeside and NAB one could get a 90 % no lmi deal for many years. BUT 17 year PI repayment schedule, so that their risk was reuced more quickly.
What we are saying here with WBC is that there will be a formal policy in place that will make it so for everyone, PPOR and IP included.
Just a pity that WBC botched the introduction of it.
Other banks will follow suit.
As suggested by Nat, APRA will likely force a higher capital reserve on this loan LVR, much like they do with Lo doc Loans that are over 60 % and dont carry LMI. This means the cost of funds is higher and needs to be covered somewhere, either by the bank in reduced margin, the borrower in a higher rate, or the broker in lower comms.
Way to early to see how this will influence the general market I think, because 85 % is one of these weird no mans land positions. its not first home buyer territory.
ta
rolf
In a lot of ways, this has already been around on an exception basis. of the deal is strong for a number of reasons, they may waive the MI but with a number of restrictions.
For eg, with homeside and NAB one could get a 90 % no lmi deal for many years. BUT 17 year PI repayment schedule, so that their risk was reuced more quickly.
What we are saying here with WBC is that there will be a formal policy in place that will make it so for everyone, PPOR and IP included.
Just a pity that WBC botched the introduction of it.
Other banks will follow suit.
As suggested by Nat, APRA will likely force a higher capital reserve on this loan LVR, much like they do with Lo doc Loans that are over 60 % and dont carry LMI. This means the cost of funds is higher and needs to be covered somewhere, either by the bank in reduced margin, the borrower in a higher rate, or the broker in lower comms.
Way to early to see how this will influence the general market I think, because 85 % is one of these weird no mans land positions. its not first home buyer territory.
ta
rolf
