Forum Replies Created
Can you tell me which BANK charges a risk fee and doesnt mortgage insure.
I would be interested in your answer.
Richard Taylor | Australia's leading private lender
Yes a guarantor can be a business partner but in saying this the lender would expect their to be some financial or beneficial interest in the provision of the guarantee.
I am not sure I would want to offer my property as guarantee for my business partners home loan but everyone to their own.
If your partner is providing security by way of guarantee then most lenders would also want to have his first mortgage.
Yes you need to go full doc as otherwise it defeats the purpose.
Richard Taylor | Australia's leading private lender
Varies from lenner to lender but rule of thumb would be the LOC / interest only loan would take the total lvr to 80% and then you use this as deposit on the new property.
Richard Taylor | Australia's leading private lender
Jess intends to use the LOC as part deposit but by doing this it does not increase borrowing capacity.
Richard Taylor | Australia's leading private lender
We use Collins Securities through Perpetual.
Richard Taylor | Australia's leading private lender
Susanne
You are incorrect in most cases you the borrower do not pay for the valuation.
Certainly you may pay an application fee which covers the lenders costs of undertaking whatever type of valuation he deems fit and on what basis he requires. (i.e 60 forced sale, market val etc etc)
The valuation is done for the lender and the borrower has no legal right to sight the report.
Richard Taylor | Australia's leading private lender
No if you are referring about Widebay Building Society they are not the funding source.
Yes LMI is higher than normal, application fee is higher than normal, interest rate is higher and there are a few credit requirements when it comes to minimum employment period etc.
All in all if you fits and it gets you on board i guess it is worth considering.
Personally i would go 90% and save 0.8% on the interest rate for the term of the loan as well as lower LMI, applic fee etc.
Richard Taylor | Australia's leading private lender
1% Application fee is the same thing as a risk fee.
Either way it is more expensive than than LMI.
Why dont you tell us who the lender is.
Richard Taylor | Australia's leading private lender
Certainly obtaining pre-approval can be handy but not if it means your lender wishes to cross collateralise your 2 loans.
You would be better off to establish the line of credit on your own security first and then you can access these funds to cover the deposit (usually required when signing the purchase contract) and then get pre-approval from a separate lender for the new loan.
Also serviceability websites mean very little as each lenders calculates the level of borrowing totally differently.
Depending on the LVR will determine whether the loan is credit scored or not and if so other factors away from bottow line income will affect whether the deal is done or not.Your Broker should be able to assist you over these hurdles.
Richard Taylor | Australia's leading private lender
Nit
Yes you are able to Roll over your existing fund into a SMSF subject to complaince and nothing to stop you taking out a SMSF loan.
In essence the Fund cannot borrow so the property is held through an Instalment Warrant with a Corporate Trustee which takes out the loan and on repayment can be passed to the SMSF without Stamp Duty or CGT.
Likely maximum lvr would be circa 70% on the current climate and with some lenders standard variable.A bit of cost involved in setting up the Bare Trust and Corporate Trustee and set up fees can be a little higher as the lenders legal department wants to ensure the entities are established correctly.
Other than time to approval time everything else is normal.
Richard Taylor | Australia's leading private lender
Hi Jess
Hate to say nothing suprises me at the moment in the finance market with some lenders.
Everyone is looking to reduce their risk profile and would rather walk away from doing the deal than over expose themselves.
In saying fear not some lenders are still lending believe it or not lol.
Richard Taylor | Australia's leading private lender
Hi jhk
Couple of answers.
Lender will take the purchase price or valuation whichever is the lower so in this case they will lend against the purchase price of $247,200.
As far as Lodoc goes then some lenders will ask for BAS and Trading Statements where the LVR is over 60% but many wont. However where the LVR is 60% + most (there are the odd exception but they charge a risk fee instead) will mortgage insure the loan and you will more often than not be charged the premium.
Richard Taylor | Australia's leading private lender
Am
Hate to say i dont believe you.
The only lenders offer non LMI products are charging risk fees.
There are a couple of lenders not charging the client the LMI but the loan itself is still mortgage insured.
There is a big big difference.
Richard Taylor | Australia's leading private lender
They are not alone.
At least 1 of the other majors has its mortgage documents prepared in Mumbai.
Richard Taylor | Australia's leading private lender
AM
Just to correct a couple of points
Nodoc is not dead and 2 lenders are currently offering it.
As far as i am aware there is only 2 lenders that dont require LMI on Lodoc 80 although they charge a risk fee instead which is much the same.
LMI ovr 60% is a Government Requirement for Capital Adequacy.
There are a few lenders who will do lodoc 80 without BAS or Business Trading Statements.
Richard Taylor | Australia's leading private lender
On a funding perspective you are back to around 50% lvr subject to minimum loan amount.
Richard Taylor | Australia's leading private lender
On a funding perspective you are back to around 50% lvr subject to minimum loan amount.
Richard Taylor | Australia's leading private lender
No certainly wont go against you and nothing to stop you switching to their IO product with 100% offset account.
Richard Taylor | Australia's leading private lender
mikea1988
Why do you need to use a family pledge style loan for your IP why not get them to borrow the deposit funds in their own name and then onlend them to you at the same rate and repayment terms.
You would then claim the interest as a deduction on both loans and they inturn have a neutral income position.
Sounds to me this is all new for your Broker.
Richard Taylor | Australia's leading private lender
No issues as investment property in fact i have a few 1 bedders and they rent out excellently.
Depending on the actual size of the property you might have issues in financing a higher lvr and if you do then someone else may if you come to sell it.
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If not then as long as the Body Corporate expenses are not too high and the building is generally well maintained all should be good.Richard Taylor | Australia's leading private lender
