Hi all. My partner and I have been with the big C for years! We have a 1 PPoR and 4 IPs, 1house, 2 blocks of flats and a weekender. She works full time and i look after the properties rental return Big C just reduced our loc by $500k with no discussion . We have paid interest in advance on the 2 blocks of flats and owe $180k on loc. Our goal has been to develop 1 IP to a duplex pair this year and then move in and sell the PPoR making the new duplexes our PPoR. Our total debt is $850k and assets $2.6k. I have asked big C to release security not needed by them and await response. Any Ideas on overcoming serviceability issues.
And so, the credit crunch begins.
Perhaps some of those who were recently boasting of having “locked in equity” using LOCs should be checking their fine-print…
F.[cowboy2]Hi Lorric33
Nice little portfolio BTW, Congrats.
One thought I had was suggest you discuss with your accountant and/or mortgage broker. Maybe you need to look outside of the big C or perhaps your broker or a well connected broker can unlock some better avenues to get the Big C to see you in a different light!
The post suggests to me you obviously know what you are doing given the equity you have built and the fact you are living my dream (to be managing IPs and investments full time)
Good luck with it.
Cheers
SimonThat is terrible! The big C is my least favourite lender.
Terryw
Discover Home Loans
Parramatta
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I am with Terry.
I have come so close in loosing both residential and commercial deals with the Big “C” over the last 12 months it is not funny.
These are usually existing clients of their’s where you try and do the right thing and keep the new loan with the existing lender to save refinancing and it has back fired on almost every deal where the goal posts change half way through the deal.
I have actually sent them back my Commercial Accreditation this morning and asked it to be cancelled as i will not do another deal through them.
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C suck
Live, Learn and GrowLifexperience
Interesting to read about the Big C. We are just experiencing something similar. Had pre-approval to borrow up to $550000 2 months ago. Had just found a property that we want to develop with 3 units eventually which went to auction last night.
I went to the bank just to check that everything still ok and also to arrange extended credit for deposit if we were successful at auction (we have $220000 equity tied up in PPOR which we are selling and due to settle in 2 weeks) and friendly bank manager decided to re-do finance app given that we had a more specific idea of what we wanted to do. We worked on purchase price of $600000. Our loans manager did not appear to have any issues with the financing of the deal and said that she would have confirmation back from (the dreaded) head office yesterday.
I remain stunned to this minute that I get a phone call about 3 hours prior to auction to tell me that we are now only able to borrow a max of $320000!!! All the same details were used for this. How can that be one wonders? Of course, no explanation from the bank.
The funny thing is that the property did not sell and am currently looking at alternative sources of finance. The bank’s offer of $320000 with our injection will still leave us short by about $50000.
Clearly there is a BIG lesson for us. NEVER NEVER NEVER rely on one source of finance!
The Big C isnt in my good books at the moment, they are asking for documents which is just simply not needed for the loan to proceed. Telling us to re fax applications because they lost the whole damn file! giving us a call 4-5hrs after we logged a call. They are promising us better services and performance but clearly the service isnt there still. Been in contact with Don Keating(Executive of LPC in WA) for awhile now, reassuring us of fixing these errors. Its just not working.
Almost 99.9% of applications that i send through to CBA will get stuffed around or delayed some where along the process.
*Deep Breathes*
Regards
Joshua McEwen
Finance Broker – WAhttp://www.prestigeloans.com.au
Brokers Lic 1297
Licensee Brett ChristieHi every one
I am new to all this, property investing. my new business is buying renovation then selling apartments. just sold my first reno for a very tidy profit, 2nd one settles monday, I’ve only been in business since theend of may[biggrin]
I told the big C to jump in the lake 12years ago. My husband died in 91 and my business failed, I was 20000 in front on my motgage when I could not make a payment on time, I went to the branch and asked if I could make the payment 3 days late without penalty he said no, so I went hame rang home banking and change my auto deduction date to match when I could make the payment. I then found a new lender and refinanced.
I am currnetly with NAB. lodged loan application friday, approved tuesday, signed and finalised monday ( could have been thurs afternoon or friday – couldn’t get there) for settlement this Monday
now that good going – not one problem.and so far I have told them what I want in a Loan and they have matched it.
[evo]Celeste
Hi Celeste. Good on you!. Sounds like you’re doing well…..Congratulations and all the best.[thumbsupanim]
Yeah tell me about it Josh – enough to give a broker a heart attack. 9 out of 10 errors they send me are incorrect. I could spend about a week explaining the depth and breadth of the F*** ups they’ve made me deal with for the last months deals – it’s driving us ALL nuts –
Some tips to deal with them
1. Use email – instead of logging calls, they give you a ‘written’ response which I find useful with more ownership
2. Fax all information to their number TWICE despite the new unique ID fax they send you they still lose them
3. Make sure any deals submitted to them are tracked daily
4. Yes – Breathe….
5. KISS YOUR BDM’s ARSE!!!Liz
Mortgage Lender
The opinions expressed in this public forum should not be construed as professional advice of any nature.
1300 780 826If the Big C are such a poor outfit, why do they keep getting the lion’s share of business through the broker market? I was looking at some numbers the other day which seemed to suggest they remain at or close to the top of the tree in volume terms….
…or is everyone prepared to support poor service if the rate is right?
Celeste and anybody else using a normal bank whether that is Big C or NAB
Check your loan documentation – they can do what they did to lorric33 anytime they want, plus a hell of a lot more. I have seen many stories like that.
Investors should look at some of the non-bank lenders, where the loan can not be adjusted, unless you are in default and that is a different story.
Many think their bank is looking after them, but investors like Loric33 take themselves outside normal risk profiles. A bank does not need to take such risk as they make enough money looking after clients who are within the normal parameters.
Regards
JohnInspired Finance
[email protected]
(02) 9944 7776Hi all
I have used the bank because all our other loans / buisness files p & l’s etc are already with them, and I needed to make it simple for hubby, he’s not real good with debt. I love it ! I have been a senior bookkeeper for 26 yrs and totally love spending some one elses money.
Hubby and I have many strings to our bow that I didnot have enough room to accomodate everything on the application form, I hope to have the trust stand alone to make things a little less complicated. I guess, I will find out if this is so, when I use the trust to get a loan, at the mo I get the loan and lend it to the Trust.[blush2]
As I build up capital & or equity I will move away from the Bank and move my LOC from our PPOR. to lessen risk.[biggrin]
Celeste
Celeste
When a Trust gets a loan, the borrower is actually the Trustee, and if the Trustee is a Company, then the Director/s guarantee the loan to the Company.
If you are the Trustee and you are borrowing the money for the Trust from NAB then you are on the application form, and therefore under their loan documentation, it is in essence cross collateralised with all your other loans, whether it is a standalone loan or not.
Hope that helps
Regards
JohnInspired Finance
[email protected]
(02) 9944 7776Hi John
I know there is no ultimate way of protecting your self against litigation, one frim I did the books for, is one the the top legal firms in Perth and I’ve seen him work!! need I say more?
We are in a position (by our standards and goals) were we do not have to take risks or only take little risks and keep in our (hubby’s) comfort zone.
What I can do though is keep my PPOR at arms length.
Be in a positions were the properties I buy cover the loans and not the PPOR unless of course it’s a really good deal (and I can talk Hubby into it)
Celeste
Although I am not talking about litigation, I would say that many wealthier people use trusts to protect their assets, and it does work, as long as you abide by a few rules.
If NAB holds your title over your PPOR, then it is at risk.
Regards
JohnInspired Finance
(02) 9944 7776Banks have a reason for what they are doing – risk management [theirs not yours].
Town houses in suburb A may be the flavour of this month but 3 months down the line the Bank may have too many of those in their books – hence no more loans for Town houses in Suburb A.
The poor consumer [us] is obviously confused and bewildered. it was ok then but why not now.
another interesting observation: assume you have a 80k loan on a 100k property. due to market downturn property value drops to say 80k. the bank can get back to you and demand that you reduce your loan to 64k [assume 80% lvr]. they may very generously give you 3 to 5 working days to do this. if you cant you end up selling in a down market and losing money.
whether it be the Big C or X or Y the scenario would be similar.
Moral of the story:
1. Never put all your eggs in one basket.
2. Dont let your right hand [bank X ] know what the left hand [bank Y] is doing.
3. Dont even think of the term “loyalty”; when policy changes your friendly Relationship/Bank manager can’t do much.
4. Remember you are just a number to the bank. it is always better to be different numbers to different banks for different IPs [biggrin]Kattan
Well said kattan. You explained the very conservative approach bank (the big C) takes on the current uncertain economic climate. Their motto is – someone else can have your business when it looks bad in their book on exposure risk.
Perhaps it’s time we took a breather to check our sums if it stacks up in the light of possible interest rate hike another percentage point some time done the line. Heck, the bank must have factored that in.
CT
Just note that many of the non-banks do not have the ability to change the LVR – there are options other than the banks
Servicing calculators do factor in a higher interest rate, but if you do move outside their risk profile……
If you want to deal with banks you can spread it around between them. Although they can see your position, their risk is lower.
I have seen 14 days and 30 days, but 3-5 seems a bit harsh. You can stall them while you refinance.
Regards
JohnInspired Finance
(02) 9944 7776
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