Which first-up lender would you choose for investing (aggressive)?

Hey All,
Just wanted to put this out there to see if there was a consensus among the brokers on here.
Shortly I will be purchasing my brother out of his share on our PPOR and in the meantime moving to a new lender (Currently with Bankwest, no LMI paid).

I plan to invest quite aggressively and will look to take my LVR to 90% (95% is probably a bit too agressive) and use the equity to immediately purchase an IP. I also plan on renovating the property which once completed I will likely try and draw the equity again for another IP.
I would say I have a medium-high appetite for risk which will hopefully support my aggressive plans in accumulation phase.

So question to the brokers is who would you recommend as a good lender to begin with on my PPOR based on this limited information I have provided.
 
The 90% purchase isn't the aggressive part.

Would be wanting to ensure that you could extract the equity gain via a cash out for the next purchase after the renovation. This @ 90% can be difficult with some lenders.
 
This @ 90% can be difficult with some lenders.

I suppose this is what I was getting towards with my question.
Which lenders in your experience are not as difficult in this scenario.

Or maybe a better question would be which lenders would more easily allow me to extract equity gains as far as to 95%.
 
It's a very open ended question which can really only be answered in the context of your personal circumstances, the existing deal and the longer term strategy.

In very broad terms a good starting lender might be Westpac or CBA, but this is a very, very general answer and may be completely unsuitable. Neither lender is the most competitive on pricing at the moment either.

These days it would be very rare for me to recommend BankWest as part of an investment strategy.
 
Brokers will chime in regarding different banks.

I can comment on CBA, minimal fuss. If can show servicing on the future purchase (eg; equity release $50k to buy next property for $330k, credit officer has asked to demonstrate able to afford the $330k property)
 
Thanks for the quick replies.

Peter definitely appreciate your response and understand with the broadness of my question it is hard to give some kind of definitive answer.
Among all the answers so far it is basically 3 of the big 4 banks.

How about 95%? Is this possible with the banks mentioned thus far? If so what would the banks be asking for to allow this.
 
I would opt for ANZ/CBA decent cash out policy for your 1st -2nd property esp where equity is involved...generally big 4 banks early on ( beside nab) and smaller banks later.
 
As Peter suggested, it depends on the scenario, goals, plan.

Generalising, i like to go to either ANZ, CBA or Westpac early. As Jamie said, I also find ANZ's cash out process the simplest. Take out the first couple loans with one of them. Leave a well educated sized servicing buffer before moving onto another lender. Make that educated buffer estimate with the best information available at hand about investing strategy (e.g. is the client looking at 5% yields, 3% yields, or 9% yields. Are they young and increasing their salary quickly, or has it plateaud, what purchase price are we at 300k or 600k? etc etc).

Realistically, if an investor comes in and has a very narrow parameters in what they're looking to purchase and is very clear about it - it can be mapped out how to get to property X. Lots of assumptions will need to be made about future lending conditions, but taking them as is, can be done if clear about goals and timing.

As mentioned, its 'expensive' early given the rates on offer simply don't compete with the real cheap end of the market. But over time, once you have multiple loans put through, it ends up being very competitive as the package fee is dissolved over a number of loans and discounting potential grows.

Cheers,
Redom
 
Brokers will chime in regarding different banks.

I can comment on CBA, minimal fuss. If can show servicing on the future purchase (eg; equity release $50k to buy next property for $330k, credit officer has asked to demonstrate able to afford the $330k property)

The problem is that if you can't show affordability under CBAs policy for the $330k purchase, you won't get the $50k cash out; even though you might be able qualify under Westpac's or NABs policy.


In my experience - ANZ are the best with 90% cash out. Most recent was a $150k equity pull with no hassle.

ANZ are definitely one of the best for cash out, but they're terrible for future servicing. Add another 3 IPs to the portfolio and most people can no longer qualify to get that cash out.


[RANT]
ANZ is good at first but difficult to get money from when the portfolio grows a bit. Some things are really easy, others aren't.
CBA is better than the ANZ, but eventually runs into similar serviceability issues. They've got a lot of policy and paperwork 'quirks' that may or may not work in your favour.
NAB is very good in future servicing if you haven't used them too much previously. Their branches seem to cross collateralise by default.
Westpac is fairly reasonable (equivalent to the CBA) for servicing, but at some point they start to treat you as self employed even when you're not. This can create all sorts of challenges.
St George/BOM/BankSA are so disorganised that [DELETED TO MAINTAIN PG RATING].
ING probably won't give you money more than once.
BankWest like to employ bait and switch lending tactics that cost customer money.
Suncorp definitely won't give you money more than once.
...
[/RANT]

In summary, there's no ideal lender especially if you're employing a strategy that involves LMI. The right lender at any given point depends on a number of individual factors which can change over time.


Edit: Avoid 95% if at all possible. The math often works out to, borrow $2, give $1 back in extra LMI premiums. The cost is too high for the benefit. Equity release becomes almost impossible for the immediate future. Assessors look for reasons to decline the loan rather than approving.
 
Can anyone correct me if i am wrong but
  1. ANZ is one of the most conservative lender; their borrowing capacity for investors are generally 20-30% less than other banks.
    AND
  2. They will service a 5 year interest only loan at P&I over 25 years plus a 2%+ margin.
    eg Current debt = Calculated based on current balance and calculated on a rate of 8.13% on p/I ==BAD vs other banks which is Current debt = Based on your current repayment even if it's interest only.
 
Can anyone correct me if i am wrong but
  1. ANZ is one of the most conservative lender; their borrowing capacity for investors are generally 20-30% less than other banks.
    AND
  2. They will service a 5 year interest only loan at P&I over 25 years plus a 2%+ margin.
    eg Current debt = Calculated based on current balance and calculated on a rate of 8.13% on p/I ==BAD vs other banks which is Current debt = Based on your current repayment even if it's interest only.

For the first property they're actually one of the most generous. Your second point is why they tend to be far more conservative when people hold other mortgages.

* I don't think you can quantify how much more conservative they are. In some cases it's not much, in other cases they won't give you a cent when others will lend millions.
* Lots of other lenders (CBA, Westpac and a lot of others) have similar policies which can lead to similar results. ANZ just tends to get their faster.
* The ANZ aren't even close to the worst.
 
[RANT]
ANZ is good at first but difficult to get money from when the portfolio grows a bit. Some things are really easy, others aren't.
CBA is better than the ANZ, but eventually runs into similar serviceability issues. They've got a lot of policy and paperwork 'quirks' that may or may not work in your favour.
NAB is very good in future servicing if you haven't used them too much previously. Their branches seem to cross collateralise by default.
Westpac is fairly reasonable (equivalent to the CBA) for servicing, but at some point they start to treat you as self employed even when you're not. This can create all sorts of challenges.
St George/BOM/BankSA are so disorganised that [DELETED TO MAINTAIN PG RATING].
ING probably won't give you money more than once.
BankWest like to employ bait and switch lending tactics that cost customer money.
Suncorp definitely won't give you money more than once.
...
[/RANT]


Bah hah man that hurts, but its so so true in my exp as well, and I can add a few


ta
rolf
 
Very interesting read thank you all.
I guess collating all the responses, for my situation (first property and want easy cash out) then ANZ is probably the bank of choice followed by CBA and then Westpac.
 
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