A little short of obtaining finance (help)

Get in touch with this person.

 

Very interesting, I'd be keen to hear how it could be harmful? or if you can elaborate how the mortgage insurance structures work behind the scenes that would be appreciated? I could've been fed miss-information by my poor experience with the broker who told me that initially. For context, during my first home loan experience there was a lot of unnecessary back and forth with a particular lender so I advised the broker to look at other lenders. However in response to this he told me told it would be futile as the underwriters are typically the same from bank to bank, there were only 3 in Australia and they dictated the lending approval and he said that ANZ was the only big bank that underwrites it's own. Trying my luck with this, I then went to ANZ the next morning and had a pre approval that afternoon, they concurred his story about underwriting mortgage insurance. In hindsight, he could've been telling porkies to discourage me to change lender and stick with what he was proposing, who knows? but I've since had 3 loans through ANZ in 3 years.

 

Harmful - multiple hits to credit file. Possible Suboptimal lender when paying LMI potentially which could bite in the long run. Possibly More expensive rates than necessary. Very conservative lending calc.

There’s just way more efficient ways to get an approval that actually suits your needs - it sounds like you didn’t have a particularly knowledgeable broker the first time round.

 

Anz use QBE, they have underwriting or delegated authority. This means it doesn’t go to the insurer, as long as it meets agreed policy, which can be misconstrued (or miscommunicated by bank staff) as having their own insurance.

 

CBA says im just about right now NAB trying hardest again...well keep you posted anyway.
Appreciate all help.

WESTPAC said no wirthin 15mins.
No i am not giving my details away only circumstances, nor am i signing anything.

 

I think my key take-away from this is that you still haven't listened to the great advice a lot of admittedly brokers have given you and that is to go to one. Anyone who can't see the value of a broker should definitely read this post especially given the tighter lending restrictions starting to come into play

 

Does this issue (i.e. simple application for preapproval or discussion negatively affecting credit score) happen even when a potential borrower easily qualifies for a loan or is it only an issue when they don't qualify?

 

Yes. The moment they enter your details into their computer to qualify you for a loan or pre-approval, a credit check is run.

Today you might qualify for a loan with a particular lender. 4 or 5 enquiries later you may have damaged your credit file to the point where you no longer qualify with that same lender.

 

The result of the hit doesn't change the impact - so even if you were approved it will still provide the same score reduction in credit scoring systems. There are some major lenders for instance where their systems will automatically decline any applicaiton whatsoever, if a file has 10 recent applications (ie in the last 12 months). This might seem like a lot, but I've seen this become an issue when a borrower has:

• bought 3x properties, renovated and cashed out on each
• refinanced 2 properties
• changed credit/car loan

Then suddenly is seen as a pariah by credit scoring systems.

 

Thanks Peter and Corey.

What is the underlying reason for this practice by banks - in relation to people who are actually good credit risks, I mean?

It seems bizarre.

 

Statistics. It may seem bizarre, but the proportion of people who default after 10 credit hits is much higher (for instance) and statisticians decide its better to let that business go to another lender.

 

Try RAMs...they assess on actuals so you should be able to borrow more. But they are changing the living expenses to be in line with Westpac.

 

Rams haven’t used actuals since 2014.

 

I know a guy who's fairly decent looking and quite charming. Went out with him one night, he got a little drunk and in the pub proceeded to very publicly hit on every girl in the room. Everyone saw it and was fairly quick to reject him.

I've had people come to me wanting to get a mortgage. I look at their circumstances and tell them that there's a problem and give them the reasons. Then they go to the next broker and ask for a mortgage but they change the story a bit to avoid disclosing the problem. I've seen this pattern many times

Essentially if everyone in the room can see you approaching everyone else, they all start to think you're a bit desperate. If nobody else wants to deal with you, then perhaps there's a reason for it.

 

Not always a guarantee - I got caught out with this a few years ago. Got pre-approval, bought a place for less than the approved amount, then got knocked back when buying.

My broker tried, without success, to found out why. After weeks of investigation, we still never got an answer.

 

Hi Tom, how do I know if it is a full assessment pre approval or not? Do I just confirm the letter with my broker? Thx

 

Yes confirm with your broker

 

Yeah, your wrong.

At the same time, I have never worried about how many hits my file has had, but I think the lenders know the lending game & when you have a track record......., so it is not the same for everyone at all banks, far from it. Def different between them.

 

Yeah, but if you explain that your simply not able to stop at one.....they may take pity, and benefit from the money you will make them