Forum Replies Created
Perhaps the mortgage insurers make more money by paying back a small refund but not having to insure that loan anymore?
There must always be a logical reason (bottom line fiscal benefit) why large companies do these things. My understanding is that they only refund within the first few years and the refund is only small in proportion to original fee. This would mean more bang for their buck wouldn’t it… eg. as a mortgage insurer you are writing off a large portion of the risk, but you are only giving back a small amount of the fee, and all within the high risk period.
I think this is smart practice, and of benefit to the customer too, win win.
Liz Wilson
Mortgage Lender
[blush2] Shucks we are loved![biggrin]
Liz Wilson
Mortgage Lender
Originally posted by Nat R:LMI is a generic term….StGeorge have ther own insurance compnay so they charge a fee to insure interantally
Incidently, St George call their “LMI”, as you say, a “Loan Extension Fee”… Sorry Nat, it just doesn’t gel with me to use terms loosely or generically. If you were to call something LMI might you be misleading people that they could ever claim any back should they refinance?
I don’t think St George could call it LMI either, as it is a fee… that may have something to do with full disclosure of fee requirements (UCCC)… but don’t quote me on that.
Liz Wilson
Mortgage Lender
Originally posted by Nat R:There are many differnces between a broker and an originator…but many people miss use the originator label.
Nat I think you’ll find that “mortgage originator” is the pretty word for broker. [blush2]
Liz Wilson
Mortgage Lender
Jen,
If you do decide to go ahead with a purchase I have a contact for you who can help. She is a solicitor that helps with applications to the Forgein Investment Review Board that you will need to gain permission from. PM/Email me if I can help here.
Liz Wilson
Mortgage Lender
Hi All,
I’m confused! The home loan company’s website says it does 100% finance provided you pay for stamp duty, legals and LMI… BUT they then quote St Georges interest rate and say I have to pay LMI?? But ST George don’t charge LMI. Non conforming lenders insure there own deals and have fees that are NOT LMI.
I think there are alot of confused people out there. Even the brokers are confused…
3% GENUINE SAVINGS FOR ALL LENDERS MORTGAGE INSURED DEALS – CAN ANYONE PROVIDE EVIDENCE TO THE CONTRARY? (NOT including 9010 deals)
Yes there are non-conforming lenders offering 100% finance – they are great in this day and age… but don’t be fooled by lenders claiming 100% finance that is really 97% finance or less???
Also heres a good quote from an un-named “originator” (BROKER) “we don’t charge fees, but if you go to a broker they will charge you fees…” –
SORRY NOT TRUE…[grrr]
Furthermore, what is the difference between a broker and an originator – your comparing apples with apples… we are one and the same.
Liz Wilson
Mortgage Lender
Hi Rob,
Yeah thats right, they may capitalize LMI but some places charge another 20% on the premium for this. Otherwise they may capitalize to a max deal of 97% inclusive of the LMI fee… meaning its really 96.5% finance.
St George may be the way to go for some people.. but if you have the gen savings, depending on the size of the loan, you may want to save money on your interest rate as compared with St George… case by case though ey?
Liz Wilson
Mortgage Lender
Hi Zulu,
Yeah give us the postcode – this will guide us backup brokers.. You should take 20% of the IP price out of the equity in the PPOR and finance the rest in the IP. That way you can access the additional equity in your PPOR at a later date.
I’ve done rural zoned property in non metropolitan areas for 80% no worries… it does come down to the postcode, the property type, property size and the zoning of the land.
Let us know will you… then we can tell you how good your broker is – hee hee[exhappy]
Liz Wilson
Mortgage Lender
Hi Jen,
Are you boarding at mum and dads for now? What income do you use to pay for your living expenses? I don’t think you’ll get a loan on rental income only…
Want to email me your figures? I’ll can then work out how much you would need to earn a week to get the loan you want – and also what your costs are. What state are you in too?
Hope I can help…
Liz Wilson
Mortgage Lender
Nat R,
Do you want to enlighten us all? There are some smaller boutique lenders (or non-conforming lenders) I guess you could call them, that do 100% finance plus costs, but from what I have heard you have to be on a high income and stable employment history to get it.
I have to agree with Rob, out of your mainstream banks and non-bank lenders, which most mortgage brokers have on their panel, St George are the only ones who will lend 100% without any genuine savings.
Geronomio – of the two Mortgage Insurers – PMI & GE, can you enlighten me as to which make ANY exception to the rule of 3% genuine savings??? No 100% finance (if it REAL 100% finance) can be mortgage insured – as these mortgage insurers require 3% genuine savings plus costs. So the maximum deal is 97%…
Beware not to fall into the trap that some lenders seem to make by saying 100% finance when they mean 97% finance… you have to have 3% of the purchase price as genuine savings (saved over a period of 6 months in a bank account) then costs for duty charges, conveyancing and other misc…
Is everybody clear?
Liz Wilson
Mortgage Lender
Hi Ritchied,
To put it simply, any loans you have against your owner occupied home (i.e. $250K current debt, extending up to any redrawn amount) are secured by your current home PPOR. So if you default and default the bank can sell that home, your PPOR.
The loan you take out for the IP which will likely be 80% of the value of the IP, will be secured by the bank by the IP. So defaulting on that loan will not affect your own home. The exposure you have taken against the collateral of your owner occupied home is limited to however much you use from your redraw.
I probably digress too far… but basically if you don’t cross collatorize (which some banks may try to get you to do) your risk on the Owner Occupied home is limited to that loan you have now – whatever balance it may be. You really should not have to cross collatorize (offer both titles ie owner occupied AND investment as security).
You should be able to split your current loan into two seperate accounts, one for your investments so that your accountant can trace which funds are for what purpose easily.
I hope I am clear?
Liz Wilson
Mortgage Lender
My two cents is that Sydney has peaked… prices are dropping, bubble is deflating… I think for the next 6-12 months we may see more of that… then it should resume to more realistic growth rates…
Definately a buyers market – especially in NSW if investors try to offload before July 1st
Liz Wilson
Mortgage Lender
There is a Private messages link to the left of the page – below “forum boards” and above “investor strategies”…. although being a newbie too i have realised i need to be looking in Forum Boards before the link comes up… if you have a Private Message there will be a little red “1” or number next to it so you know there is a new one. It also saves your private messages. I’ll send you one so you can see it work ey?
Liz Wilson
Mortgage Lender
Hi Ezy,
Is that near Coffs? Inland near to Urunga? Bellingen? Some of those places are really going ahead…
One of my clients is subdividing alot of land up that way. Will make alot out of it. You might want to see what a developer thinks of the land? I think if you were to cut it up into two you might get more? Units in a place so sparsley populated might be risky, especially if the restaurant is a going concern. My guess is that people would go out to find a nice secluded house?
Good Luck
Liz Wilson
Mortgage Lender
Regarding the initial question – try a different broker – or find out just how many lenders your broker services (raised eyebrow). It depends on your scenario and how you have structured your loans – for a second opinion email me and I’ll tell you what I think…
DD
Regarding the comment about ex CBA brokers… well thats a bit of a rough generalization my friend… do you think every ex CBA employee is “ex” because they loved their job?? I will not defame them here, but I went to work on my own because I KNEW I could do a MUCH better job if I was the boss…. catch my drift?[wink2]
How good your broker is depends on the person, not on the company they are with, nor on the company they were with… the answer lies in their head. I would have laughed too though, the spirit… hee hee [tongue]
Liz Wilson
Mortgage Lender
Hi Rob,
Come back out into the playground!
Differences of opinion should be discussed openly in a dedicated Forum, so whomever sent you the nasty PM should probably come out in the open and let the contributers decide for themselves.
Hope to see you back on the boards soon!?[blush2]
Liz Wilson
Mortgage Lender
I think the tax man could Supina the information if they wanted… as someone said earlier taxman is GOD…
What does everyone think of the Lo Doc’s available for under 65% where you declare “capacity to repay” NOT “I earn $XXX,XXX.XX”. Wouldn’t this save alot of grief… provided it was conveinient that you did not need 80%?
Thanks Rob,
Wasn’t sure as I did have one particular NZ client who told me of something AFTER settlement, that the banks should have really picked up on.
Strange that it slipped through the cracks don’t you think?[hmm]
Liz Wilson
Mortgage Lender
Quote:Originally posted by Motivstorm:lizzy, 150 per week rental for a 90,000 house isn’t exactly fitting the 11 seconds rule? unless there’s some creativity put into the deal?
Hi Motivstorm… Sorry for my ignorance, I am not completely familiar with Steves work but this refers to the purchase price of the property being derived as a funtion of the projected rental…
I must admit i’m slightly skeptical that this should be a hard and fast rule of property investment. A keen eye for capital growth areas coupled with a property creating passive income from day one gets me interested. Thus far I am a supporter of Steves work in general.
Still – each to their own.
Liz Wilson
Mortgage Lender
Hi Sparkie,
Try not to let the banks put a smear on your credit report that takes 5 years to clear… until then you’ll pay out your nose with a higher interest rate.
You can obtain a copy of your credit report by calling Baycorp Advantage on 9464 6000, its free if your happy to wait 2 weeks, or for a small fee have it within 24 hours. This will tell you if you’ve got anything to worry about YET. Having limited experience in intercontinental credit ratings perhaps you should ask them yourself whether bad debts in NZ affect your credit rating here? Can anybody enlighten us?
It sounds like you might be of the self-employed variety? This may cause difficulties in obtaining finance if you have only been back in oz for a small while, were you here before NZ? Your income stream may be lumpy if you are a contractor, you will need some guidance as to which bank will consider your income.
Perhaps you also need to be honest with yourself (financially speaking) as to why you are not happy to pay off your debts in NZ before getting yourself into debt here?
However do the research, find out whether your debts there will affect you here by talking to Baycorp…
Any ideas Rob?
Liz Wilson
Mortgage Lender
