Faq

We work with all of the major lenders and many of the smaller ones, having access to over 25 lenders. Depending on your circumstances we will find the right lender and product for you.  Our best interest duty is to you,  not to the lenders.

We believe in a human approach assisted by technology. With over 25 years experience we have found that as the loan scenario gets more complex,  the technology is less effective at putting a tailored lending strategy together that suits your needs. This may change in the future,  but we will always assign a human mortgage broker to you for direct contact.

While you will see many advertisements with low rates the T&C’s are crucial to read as they will relate to specific scenarios. The factors that most influence the rate offered are:

1. Loan to value ratio – the lower this ratio is the lower the rate we will likely get offered by banks.
2. Loan amount – The more you borrow the more likely a bank is to give you a better rate.
3. Loan features- As a rule the more features a loan has the higher the rate will be. Eg. Loans with offset accounts will either have a slightly higher rate or a fee attached to the loan.
4. Credit history – The better your credit score the lower the risk to the bank,  therefore you may receive better interest rate offers.
5. Is mortgage insurance required- If the answer is yes than most lenders will have a higher rate for these applications.

There are other factors but these are the main ones. We also request pricing from many lenders for your scenario and make the banks complete.  Not all the banks advertise the best rates they can offer! So it pays to go through the formal process.

Currently most banks have a premium on investment lending of between 0.15% & 0.25%.  This is due to bank regulations and how they source their funds. Some lenders also have different policies depending on how the loan is secured as well. When we speak with you we do look at lending structures/lenders in order to lower the interest rate where possible.

Let’s say you have a loan for $300k and have $30k in your offset account. This means that you will only pay interest on the difference, in this case $270k with a 100% offset account.  Now this is where its gets trickier. Not all offset accounts are 100%, some are a lower percentage. The way they are applied also differs between lenders.  Most lenders will still take the repayment full monthly repayment. With the saved interest being applied to the principle loan amount.  Some banks allow this to be available in redraw while other lenders don’t. Either way they will help you pay off your loan quicker.

That said if you are not likely to have much in your offset account then the cost of having an offset account (either slightly higher interest rate or a bank fee) than it might not be worth having it. This is something we discuss when looking at you lending requirements. A basic loan with the ability to repay more and redraw may be a perfectly suitable outcome.

There are some other scenarios for investment properties which complicate the matter,  especially if you have an owner occupied loan.

This means that as a mortgage broker we must put your needs before the lenders or our own when deciding on lenders and products.  Bank staff are not covered by this duty.

There are many ways to do this depending on your unique situation. Some questions to think about are.

Are you providing cash or equity in another property for the deposit and costs?

Are you planning on owning it in your personal name, a trust/company or SMSF?

Yes you can, it requires setting up a SMSF and there are rules and regulations around property types. But you are able to buy residential or commercial property. We have staff (with financial planning experience) that can answer your general questions on this process,  though we do recommend seeking financial planning/accountant advice for the actual set up.

The loan is set up using a bare trust which holds the property and the lending for the SMSF.  While SMSF lending is a little complicated to start with, the process is not too different from regular loans. Interest rates for SMSF loans are higher that non SMSF loans as a rule,  as the bank takes on more risk. 

Some lenders offer offset accounts while others don’t.

Actually there are few schemes available at the time of writing this.  Some are federal grants and some are state based. Some give you cash while the others save you paying stamp duty or mortgage insurance on your loan. When we speak with you, we will try to work out which ones are suitable and applicable to your circumstance. In some instances we have combined applications using 3 different offers! This can lower the cost of the loan and potentially leave you with additional savings after settlement. So they are definitely worth exploring and doing the additional paperwork for. We don’t get paid for this,  but are happy to help you with the paperwork.