Hello there,
I am currently looking at low doc for land and house package in WA. I may sell property on completion, (12 months to complete)I understand exit fees can be expensive.
My broker is currently looking at St GeorgeIs this the same genally for ALL low docs??
Thanks
No. Like any loan, some have exit fees but many don’t. The comparison rate will NOT take into account these fees so you have to look at the impact of these fees yourself. They are usually termed deferred establishment fee or something similar.
Robert Bou-Hamdan
Mortgage AdviserOff the top of my head, Bankwest Lite (low doc) does not have exit fees.
Terryw
Discover Home Loans
Mortgage Broker
North Sydney
[email protected]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
It is also not the cheapest Low Doc. Be wary of the interest rate!
Robert Bou-Hamdan
Mortgage AdviserClients will also have to pay LMI. I guess you can’t have every thing.
Terryw
Discover Home Loans
Mortgage Broker
North Sydney
[email protected]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
I would be interested to know the LVR required and whether payment is due at contract date or completion of the construction.
Robert Bou-Hamdan
Mortgage AdviserAll the lo docs I have access to have 1.2% early repayment fees for the first 5 years.
You would need to look at the total costing including entry fees, interest rate, whether LMI is payable and the exit fees and compare the products that way to find the product most suitable for your needs.
State Manager
Wholesale Mortgage Lender that deals only with brokers.
20 years in Finance Industry
Check out some of the mainstream lenders LODOC entry into their normal products.
Some I use have no exit fees but they aren’t all as relaxed as we would like a LODOC to be.
Contact a broker and discuss your needs with him. The fellows who contribute here are as knowledgable a bunch as I have seen (except me of course [blush2])
All the best,
Simon Macks
Finance Broker
[email protected]
0425 228 985Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.
You also might want to check whether the loans have “Loan/security portability”. Where the loan may be transferred to another security property, saving on loan stamp duty, early repayment fees and establishment costs. This is for if you are looking at buying another property when/if you sell this one.
State Manager
Wholesale Mortgage Lender that deals only with brokers.
20 years in Finance Industry
Hi Marisa,
I think the St George low doc max LVR with interest only repayments is 70% LVR or 80% LVR with P&I, and the LMI premium is applicable over 60% LVR,
With this in mind coupled with there higher low doc rates you may want to look for an alternative lender with a lower rate and will also absorb the LMI up to 80% LVR, while keeping in mind the break costs you may incur. Cheers.Regards
Steven
Mortgage BrokerMobile Mortgage Market
Ph: 0402 483 216
[email protected]
http://www.mobilemortgagemarket.com.auPLEASE note comments made should not be taken as specific taxation, financial, legal or investment advice.
I think the St George low doc max LVR with interest only repayments is 70% LVR or 80% LVR with P&I, and the LMI premium is applicable over 60% LVR,
With this in mind coupled with there higher low doc rates ….The stats are correct. We just finalised a split lo doc with St George and these were the figures.
The interest rates I would query. Before the last rise our St George Lo Doc was at 7.32%-the going rate-Our new lo Doc fixed rate is just below 7%. I wouldn’t say that their lo doc rates were too high at all[cap]
markk
Happy Hunting
http://www.kentscollections.comFixed rates are a very different beast to a variable rate.
You don’t take a fixed rate for a quick sell unless it is a one year fixed rate and you sell straight after.
Robert Bou-Hamdan
Mortgage AdviserHi Markk,
At 7.32% the STG low doc rate is not competitive,
Also, regarding fixed rates (especially short-term 1-2 years) the revert rate should be taken into consideration.As Rob mentioned fixed rates may not be appropriate as Marisa is looking to sell on completion,
This thread/scenario also highlights what may be a good choice of lender/product for One may not necessarily be appropriate for another, Cheers.Regards
Steven
Mortgage BrokerMobile Mortgage Market
Ph: 0402 483 216
[email protected]
http://www.mobilemortgagemarket.com.auPLEASE note comments made should not be taken as specific taxation, financial, legal or investment advice.
Hi Guys,
Thanks for all the great feedback. I am waiting on further clarification with a couple of the issues you mentioned in posts.These are the rates I was quoted:
St George
Variable rate – 7.32%
1 year fixed rate – 6.94%
3 year fixed rate – 6.89%
5 year fixed rate – 6.99%Even if I were to go for fixed rate I was told I would be charged the interest for total loan amount ($300,000), regardless of our much money I draw down.
This is not the case with variable, I only pay interest on money drawn down. I will be paying builder in form of progress claims and drawing down as required.
Also I do not want to take out morgage insurance so I will be going under 60% LVR.
Any thoughts on this?
Many thanks for all your advice.
Regards, Marisa
I would be taking a loan at 6.72% variable if I was at 60% LVR on a low doc. No ongoing fees and charges and no deferred establishment fees. Only $400 application fee.
Any good broker can help you get this loan.
Robert Bou-Hamdan
Mortgage AdviserIf you are going for 60% LVR, ANZ may suit. $300 exit fees. But they will not do trusts or company borrowers.
Terryw
Discover Home Loans
Mortgage Broker
North Sydney
[email protected]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
The $300 is not an exit fee. It is a mortgage discharge fee and a similar fee applies to every loan.
Robert Bou-Hamdan
Mortgage AdviserYes Rob.
Terryw
Discover Home Loans
Mortgage Broker
North Sydney
[email protected]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
I’ve read quite a number of responses from you two – yes you know who you are! Is there no end to this “mine’s bigger and better”….. The argumentative nature of your responses is quite annoying to those of us who just want good info.
Yes your right Island Dreamer. (if you were referring to me). I am sorry!
Terryw
Discover Home Loans
North Sydney
[email protected]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
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