Hi all,
Been a little while since my last post but I was hoping to get some of the very qualified broken feedback on a question I have about cross-security.I am looking at refinancing my 3 properties (2 investment, 1 PPOR) and wanted to ensure I did not get locked into having these cross securitised. My situation at the moment is all 3 properties have different lenders (ING, Westpac, ANZ), with each property acting as security for one loan only (i.e. properties are not cross securitised).
My questions is, if I was to refinance and put all loans (and therefore all properties) with one lender, but had separate loan accounts, would this result in cross-securitising the properties? I imagine the new lender would want to take all three as security to reduce their risk but was wondering if this could be avoided?
If anyone had any feedback on the best way to approach this that would be greatly appreciated!
BM 17 – your question seems really just double checking your gut instinct – which is correct. Yes you can keep your loans separate at the one lender. No problem. However, with the structure you have now I am guessing that the reason you want to move is price or rate. Serviceability (or the way banks calculate what you can afford) will be slightly different across a panel of lenders. With multiple properties a consideration is whether the bank will use your actual repayments to calculate your affordability for a new purchase (or the refinance) or their assessment rate.
Yes can keep loans with same lender without crossing.
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
If you simply replicate the same structure you have now with the next bank and you’ll avoid crossing.
Cheers
Jamie
Jamie Moore | Pass Go Home Loans Pty Ltd
http://www.passgo.com.au
Email Me | Phone MeMortgage Broker assisting clients Australia wide Email: [email protected]
You can refinance all loans with the one lender. Just check your loan docs before signing one property is securing the loan. In my opinion having the properties spread across multiple lenders as you have it now is best for minimising your exposure risks.
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This reply was modified 9 years, 7 months ago by
Rick.
Rick | My Property Investing Tools
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Thanks everyoe for your comments, very useful.
Just another quick qestion, if I was going with a single bank, would I do a single application for the total loan amount and then split the accounts, or would it need to be 3 separate applications (i.e. one per property)?
Thanks again.
3 separate applications. More work but better outcome.
Cheers
Jamie
Jamie Moore | Pass Go Home Loans Pty Ltd
http://www.passgo.com.au
Email Me | Phone MeMortgage Broker assisting clients Australia wide Email: [email protected]
If you’re simply chasing a better rate it may pay for you to consult with your broker about having the banks reprice your loans, or if you don’t have a broker talking direct to the banks.
The banks are very competitive at the moment so you may find that if you suggest you’re leaving them for another lender they may well match the rates or come close to it.
Tom@SadhanaConstructions | Sadhana Constructions
http:\\www.sadhanaconstructions.com.au
Email Me | Phone MePerth builders of developments and bespoke homes
There are many factors to consider as the features required for an IP loan are different to a PPOR loan.
The 3 lenders you have mentioned are not ideal for a rate sensitive client and I am sure you could do better.
Would be looking at 3 separate applications especially if you can get some of the fees waived.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
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This reply was modified 9 years, 7 months ago by
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