Re-financing, 11th hour offer from existing lender

Hi Simo,

I would feel all the work of the broker has been a total waste of their time & that doesn’t sit well with me. It also frustrates me the Way NAB have dealt with the whole situation.

I think you are answering your own question right there!

Like, why did it take an action from you to “go elsewhere” before NAB took any notice of you? Why did they suddenly realise “Oh sure, you DO have equity after all”.

At times like this, I would say “Go with your gut”. I have also heard Steve say “The best rate is not always the best deal” (or words similar to that).

Of course, there is a flip side – and you would need a Broker to help you with this one…. That is, NAB might be one of those lenders who you should “go to first” to use up their largesse, and then move to another for later borrowings. But that depends on how far you plan to go (your goals) and how much positive value NAB would provide at this time.

Good luck with the choice,
Benny

Other consideration is check your Credit Proposal Disclosure as you may still be up for the brokers commission even though you didn’t settle.

More and more brokers are factoring a fee payment in post formal approval in the event you decided not to proceed and the loan did not settle or you repaid the loan in the first 18 months and they incur a clawback of the commissions paid.

Cheers

Yours in Finance

IMHO, bad service shouldn’t be rewarded. If more clients will leave the lender due to bad service, the lender will improve their service. If the lender keeps retaining the clients in the last minute, the level of service probably won’t change.

Even if your agreement with the broker doesn’t mention a fee should an approval isn’t actioned by you, I would still consider paying him for his time. Had the same thing happen to me late last year. It’s very annoying to do all the work and eventually the client decides to stay with the same lender he wasn’t happy with in the first place.

Yes, you should be able to use the equity release as a deposit for an IP but you may want to consider having the new loan done as a split so once you do draw those funds, its tax deductible 😉

Hope this helps?

Cheers,
Ethan

Course the NAB was the first major lenderto increase their interest rates yesterday.

Ask them if they will waive your increase.

newbie2015 wrote:

Do situations like this arise often? Seems to be a funny way to run a business.

Absolutely, your broker has done all of the work and would expect to get paid.

Can’t think of another Profession where you waive your fees if you decide not to proceed. Try that with your Accountant and see what he says.

Cheers

Yours in Finance

I had something happen with a different major bank some time ago. I was buying my first house (PPOR) and was a bit strapped for cash. Got pre-approval, signed contract subject to finance, then asked the bank to knock off the $600 application fee, as some other lending institutions were doing it. Nope, no chance. I might have been able to go and get finance with another lender in time, but at the time I just wanted it to go through. Told them at the time that this would be the first and last loan I’d get from them if they didn’t knock off the fee. They were fine with that. I still keep a savings account with them, and since I sold the place, they’ve tried to market loans to me now and again, generally when I’m in there getting a bank cheque done to pay a deposit on a home or suchlike. I respond by telling them that story and asking if they’re going to refund me the $600 plus accrued interest, because that’s what it will take to get me to consider taking out a loan with them. They haven’t been interested so far, so stuff them.