Cross-collateralisation ever a good idea?

As a broker and lawyer I would suggest you avoid setting up your loan in such a manner. Commissions don’t change if loans bundled together but there are brokers out there that just use one particular bank and/or product so most of their clients go into the same bank and product. Saves them having to think too much.

Cross coll can be useful in limited circumstances, but not in this situation.

Crossing securities is rarely the solution. The same result can be had by not crossing, which would give you more flexibility generally speaking. Ask him why he can’t still access your equity required without crossing securities. He should be able to answer immediately.

Seeing as you’re not comfortable with that structure, tell him. It is your choice at the end of the day. He’s a credit advisor – not a credit forcer. He cannot force you to use that structure if you’re not comfortable.

Hi Bec,
It may be you have come across this already, but if not, I didn’t want you to miss it, as the post linked below guides you to other threads that get into “What does and doesn’t work with x-coll!”

https://www.propertyinvesting.com/topic/4410491-the-big-picture-for-new-readers-especially/#post-4697974

Benny

It’s like with many other professions.

How can you be certain your solicitor isn’t dragging the procedures, all in order to get more billable hours?

How can you be certain your mechanic isn’t neglecting certain aspects or inflating other issues so he could profit more from you?

How can you know your tradie isn’t working slower than he can or recommending work or repairs that aren’t needed?

Etc etc.

The answer to all of the above is trust.

Either you deal with people you trust or you don’t.

Gut feeling plays a big role here.

One can’t be a solicitor, a broker, a mechanic, a tradie (etc etc) all at the same time but if you really think it’s best, you are most welcome to become a broker. There is time and money needed to setup and also on annual basis + 20-25 hours CPD training p/a + some lenders are not fond of brokers submitting their own loans but hey, it can be done 😊

My suggestion? Interview more brokers and see which ones you feel will serve you best.

Good luck! 👍😎

Hi Bec,

Ideally I’d love to learn how to be my own mortgage broker. Is that possible?

I’m sure it would be possible, but that would happen better if you were dealing with someone who has a wide knowledge of Broking in the first place. Terry, Richard, Ethan, Jamie and George have all shown they know the “ins and outs” of broking to a very detailed degree. Surely these are the people to learn from…. The thing is to find someone who exhibits this knowledge, and who seems to “speak your language”, meet with them, do a deal or two with them, and along the way, discuss with them all of your concerns and short-comings of knowledge.

If you have deals that are a little out of the ordinary, learn from them how to handle these things even as they earn their commissions. Call the commissions your “education fee” (that you don’t even pay usually). Discuss with them how they got started, and even ask what they would suggest for you if you wanted to “go direct”. I am sure you could do it, but how much would you be risking by going direct without first learning from those who know?

One of my fave mantras is “If you think education is expensive, try ignorance!!” :)
Good luck with your journey,

Benny

Forgot to add, these days brokers generally can’t even submit their own loans.