I want to change my ppor into ip, I went to the bank and after 2 weeks they came back and told me that since my loan is over 80% (is currently at 83% ) that I will have to either pay for mortgage insurance again or pay out $14000 to get it under the 80% but that they also wanted to get the house reevaluated and that the house might be worth less and means I cant get the intrest only loan anyway. I have the $14000 sitting in an offset account but dont really want to pay the loan off as we are saving for another investment property.
We most likey move out before march/april next year but seems kinda pointless to pay the princle off now when later we dont want too to save money on tax when it is an IP.
Is the bank just screwing us around or is this standard ?
What type of option are avaible to us? Should we be looking at changing loans to someone that know what we want or just pay the money off and change it over. Not really sure what to do and dont want to make a silly move that will cost us in the futureHi there
Which lender is this?
Did you pay LMI previously?
Why are they telling you LMI is payable if they haven't seen a valuation on the property? Are they basing this off what you've estimated the property to be worth?
If worse comes to worse, you could get a broker to order a couple of upfront valuations with different lenders and if they come in higher (so your LVR is kept below 80) you could refinance and save the LMI fee. There's a few things to consider here but it could be a good option.
Cheers
Jamie
Jamie Moore | Pass Go Home Loans Pty Ltd
http://www.passgo.com.au
Email Me | Phone MeMortgage Broker assisting clients Australia wide Email: [email protected]
Best bet is to get some Val's done. A desktop val (computer generated) may come up substantially higher than expected.
Which lender won't let you go IO?
Corey Batt | Precision Funding
http://www.precisionfunding.com.au
Email Me | Phone MeInvestment Focused Finance Strategist - servicing Australia-wide
I am currently with ANZ and have been happy with them. I just find it frustrating trying to sort out my house before I go away.
I have already paid LMI when we first bought the house 18 months ago. They told me that they will need to do a reevaluation as we bought when the prices were high and the value of the house might have dropped since.
Sounds like a dud banker. They can order the val upfront before you commit to an application (it may just be a desktop) – you shouldn't be up for a new LMI premium if the value comes in lower, only a minor adjustment to your existing premium.
Cheers
Jamie
Jamie Moore | Pass Go Home Loans Pty Ltd
http://www.passgo.com.au
Email Me | Phone MeMortgage Broker assisting clients Australia wide Email: [email protected]
Hi Winadil,
I have done the same thing with 2 different banks. When I tried to do it with ANZ I had the same run around as you (my LVR was only 50%) and eventually gave up! When I did it with St George, I rang up and said that I wanted to convert to IO and they done it immediately over the phone. Really don't understand the difference between banks, I was as frustrated as you – still am truth be told. I am still paying principal off of one of my properties as result. If anyone has had any luck with this, please let me know!
Cheers.
Yeah i am really tempted to go and shop around for a new bank while ANZ have been good to me so far this has just annoyed me
I just cant see what the big problem is changing over the loan first they wouldn't let me change cause it would go over 30+ years now with this.
I guess it cant hurt to have a look around at other banks
winadil wrote:I want to change my ppor into ip, I went to the bank and after 2 weeks they came back and told me that since my loan is over 80% (is currently at 83% ) that I will have to either pay for mortgage insurance again or pay out $14000 to get it under the 80% but that they also wanted to get the house reevaluated and that the house might be worth less and means I cant get the intrest only loan anyway. I have the $14000 sitting in an offset account but dont really want to pay the loan off as we are saving for another investment property.
We most likey move out before march/april next year but seems kinda pointless to pay the princle off now when later we dont want too to save money on tax when it is an IP.
Is the bank just screwing us around or is this standard ?
What type of option are avaible to us? Should we be looking at changing loans to someone that know what we want or just pay the money off and change it over. Not really sure what to do and dont want to make a silly move that will cost us in the futureI must be missing something. Why would LMI be payable – are you borrowing more money?
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
OP is looking to change to interest only repayments, ANZ obviously looking for new application, new val, etc, so LMI might apply.
However as Jamie mentioned, would be an difference in premium and not new if LMI has increased.
Cheers,
Tom
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