LMI issues

Viewing 5 posts - 1 through 5 (of 5 total)

masonb81
Member
@masonb81
Join Date: 2009
Post Count: 2
October 5, 2010 - 12:53 pm
Hello,
I have been applying to change 2 investment mortgages to interest only to reduce the monthly expenditure and my application has been rejected because the actual rent from one of the properties is being calculated on the market value which is significantly less that what is coming in and as a result the LMI group of my bank has rejected the application.
It just seems crazy, on one mortgage changing it to interest only would save me $1k/month so I don't understand why they would reject it due to serviceability?
I currently have 3 properties and I should be in a good position to purchase another next year if I can get financing in order, I have been looking at the possibility of drawing cash and using a cash deposit from savings to put down a 20% deposit with another bank tho I would like to hear if you have any advice about how I should go about moving forward?
Thank you in adavce.
Mason
Tony Fleming
Participant
@the-dark-knight
Join Date: 2008
Post Count: 396
October 5, 2010 - 1:07 pm
Banks are stupid they told me i could use my two properties as equity to get a 100% loan…Last day of cooling off get a call saying that it couldn t go through. Now i've got to use my own money. FML
Ps hope you work everything out
Tony Fleming | Triumphant Property Group
http://www.triumphantpropertygroup.com.au
Email Me
NSW Buyer's Agent specialising in Western Sydney-Blue Mountains-Orange-Albury
Terryw
Participant
@terryw
Join Date: 2001
Post Count: 16,213
October 5, 2010 - 8:24 pm
LMI are probably worried about your gearing levels.
You could try another bank, but be aware that many of them use the same LMI, so the problem may follow you. I suggest you use a broker too.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email Me
Lawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Matt007
Member
@matt007
Join Date: 2008
Post Count: 259
October 5, 2010 - 9:36 pm
LMI, particularly genworth, are a massive rort on the industry, and in many ways hold banks to hostage if you can believe bank staff, which in my opinion you can't.
I don't know who regulates them but someone needs to go through the LMI industry with a large burning stick to get rid of the current dead wood.
Richard Taylor
Participant
@qlds007
Join Date: 2003
Post Count: 12,024
October 6, 2010 - 4:01 am
As Terry said no point in doing a "cash out" for a deposit on another IP and finding your new lender uses the same mortgage insurer.
Your Broker should be able to advise who uses who ?
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender