Which Bank?

[Earnest1]

I am starting off my investment career and wanted to know if anyone has recommendations for banks that they use. Is it possible over time to build a relationship directly with a bank or is that a laughable notion in itself because to a bank, no matter how much wealth you hold with them, the relationship will only always be a numbers game?

I was thinking of using the Commonwealth Bank and attempting to start a relationship with them as they have Commsec for a trading platform, but they are already off to a bad start in my eyes as they don't have a very good offset account to start with.

I also understand the other side of having a sole relationship with a bank due to cross collateralisation, cross securitisation and the "all monies" clause.

Or Would it be better to use a mortgage broker and then allow them to structure and spread all lending across various lenders to suit your situation?

 

[Jamie M]

I am a broker so this will sound biased (so take from it what you will) but I wouldn't bother trying to establish a good relationship with any bank.

In this game, spreading your exposure amongst lenders, avoiding cross coll, being up to speed with each lenders niches and carefully choosing the right lender as you accumulate each property is important.

No single bank can do this - but many of the decent brokers out there (particularly on this forum) who deal with multiple lenders can.

Cheers

Jamie

 

[Rolf Latham]

I am starting off my investment career and wanted to know if anyone has recommendations for banks that they use. Is it possible over time to build a relationship directly with a bank or is that a laughable notion in itself because to a bank, no matter how much wealth you hold with them, the relationship will only always be a numbers game?

I was thinking of using the Commonwealth Bank and attempting to start a relationship with them as they have Commsec for a trading platform, but they are already off to a bad start in my eyes as they don't have a very good offset account to start with.

I also understand the other side of having a sole relationship with a bank due to cross collateralisation, cross securitisation and the "all monies" clause.

Or Would it be better to use a mortgage broker and then allow them to structure and spread all lending across various lenders to suit your situation?

Hiya

Id suggest you have a chat with a broker to map out a financing plan for now and the future x years, and if that doesnt fill you with confidence, ask bank x to do the same................

There is no "right" solution, but there are options and solutions that may work better for some borrowers than others, but much depends on ur resources and risk profile for a very start


ta
rolf

 

[Aaron_C]

Or Would it be better to use a mortgage broker and then allow them to structure and spread all lending across various lenders to suit your situation?

Generally a better option as long as the broker is a good one - one that will look after your interests and who also understands the investment game rather than just being a pen-pusher...

 

[Tillie]

I have all my banking with one bank including investment loans, credit cards,hire purchase car loan and share trading accounts. The bank has never asked me to cross collaterise anything. If they insisted, it would have been the end of the relationship

Also I managed to got 1% discount of standard variable rate for all my loans. Hire purchase deal also was really competitive when comparing quotes from other lenders. All negotiated by myself. Might be fool. But I am not loyal customer as such if the bank had not come to the party I would had not hesitated to contact any of the mortgage brokers who generously share their time, tips and expertise with us here in Somersoft. In the end it is about business.

 

[Mick C]

for 95% of home owners and investors establishing a relationship with your bank is quite useless as it's all about numbers and policy, bank loyalty doesn't pay off! ....however establishing a relationship with your business banker can be useful for business/corporate clients - but even that as it's limitation because the banker may leave or be promoted and your left with a so call " relationship"with the bank...

Always keep your options open...it;s your money after all ( ING)

regards
Michael

 

[Marty McDonald]

The DIY versus broker thread!

I am a broker but also natrually tend to be a DIY type person. If I never became a broker I probably wouldn't have used one.

However knowing what I know now (and of course you can say I would say this) I can honestly say you don't have a thing to lose with a good broker. If you want one main institution you can still use a broker to arrange this. I don't believe going direct gives you any advantage.

 

[Aaron_C]

for 95% of home owners and investors establishing a relationship with your bank is quite useless as it's all about numbers and policy, bank loyalty doesn't pay off! ....however establishing a relationship with your business banker can be useful for business/corporate clients - but even that as it's limitation because the banker may leave or be promoted and your left with a so call " relationship"with the bank...

I have found that to be the case with some BDMs Michael - a good relationship for me/clients turns bad when one of them gets promoted and I'm left with their replacement who is a MUPPET!

 

[Rolf Latham]

I can honestly say you don't have a thing to lose with a good broker.

I agree with you

About 1 in 5 humans wont though, and even if they were 20 % better off it still would not matter

To many, its about control and being "right", and I dont have an issue with that per se.

ta
rolf

 

[Player]

.................... I wouldn't bother trying to establish a good relationship with any bank.

Agree. It rarely endures and when your "relationship manager" who is really a higher level salesperson leaves or gets promoted/demoted, you're left dealing with people whose left hand doesn't know what their right hand is doing.

In this game, spreading your exposure amongst lenders, avoiding cross coll, being up to speed with each lenders niches and carefully choosing the right lender as you accumulate each property is important.

Money shops are everywhere.

No single bank can do this - but many of the decent brokers out there (particularly on this forum) who deal with multiple lenders can.

Cheers

Jamie

No bank will reciprocate your loyalty. Do what suits you best at a particular time for the particular asset in question. Diversify the lenders as Jamie mentions and use a good broker who understands investments. Many have already responded to this thread.