Join Australia's most dynamic and respected property investment community

boq specialist

Discussion in 'Property Finance' started by kr11, 24th Jun, 2015.

  1. kr11

    kr11 Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    81
    Location:
    sydney
    Anyone here using boq specialist 90 no lmi and your experience with them
    I enquired at a seminar with one of their reps who i won't name but he was saying that they take ofi debt at actuals? is this true. if so it seems that they r a very generous lender, but seems hard to believe, as boq have buffers for servicing i thought?

    thanks
     
  2. patience

    patience Member

    Joined:
    20th Jun, 2015
    Posts:
    14
    Location:
    Brisbane
    Further to this, BOQ specialist have offered me both loans of 100%LVR for PPOR or 95%LVR for IP loans, due to my occupation. The catch is that any lending above 90% LVR is charged at an interest rate of ~10%. I've been told doing this works at cheaper than taking out LMI and they structure it so you pay down the high interest portion of the loan first.

    Have the brokers got any opinions on these loans and whether they will cause issues further down the track?

    Cheers
     
  3. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

    Joined:
    18th Jun, 2015
    Posts:
    8,979
    Location:
    Sydney
    Sounds good and I would consider it if you qualify. But at such a high LVR consider keeping a few eggs in different baskets.
     
  4. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

    Joined:
    14th Jun, 2015
    Posts:
    1,165
    Location:
    Gold Coast
    The cocktail isnt available to brokers........... that should tell you something for its long term viability.
    the mix isnt that unusual, other lenders such as medfin, investec et al have been doing such things for a while.

    ta
    rolf
     
  5. patience

    patience Member

    Joined:
    20th Jun, 2015
    Posts:
    14
    Location:
    Brisbane
    Are you hinting that this kind of offer may not be available for much longer moving forward?

    I'm only at the very beginning of my investing career and thought it may be a good option to get skin in the game without the need for large deposits.

    Cheers
     
  6. kr11

    kr11 Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    81
    Location:
    sydney
    If u are the beginning of your ip career, i suggest u use a good broker and use anz,cba, stgeorge, nab(medfin) or macquarie with a good broker from here
    all do 90% no lmi AND you can insist on NOT x collaterising ips
    Being at the beginning of your ip journey, u should qualify with one of these banks
    BOQ specialist, will be around for a while. They took over investec, but after speaking with their rep
    they insist on cross coll. They are good for servicing and90 no lmi, BUT Not good for ip accumulation.
    This will affect your ability to cash out 90% and use other lenders later on
    U will b stuck with them and if u keep using them, they will reduce the lvr to 80% and less
    So, Boq is ok for 1-2 properties max, not more, and they are not available via the brokers.

    hope that helps
     
    lauz358 likes this.
  7. patience

    patience Member

    Joined:
    20th Jun, 2015
    Posts:
    14
    Location:
    Brisbane
    Thank you very much kr11, definitely clears a few things up for me.

    I don't have much in terms of a deposit currently so will throw up a hypothetical. What are your thoughts on if I purchased 2 IP's using their 95% no LMI and then work over a few years to reduce these to an LVR of 80. Would this then allow me to refinance more easily with favourable institutions?

    Just tossing up if its better to buy earlier at 95% or save a little longer and go for 90% with ANZ, medfin etc.

    Cheers
     
  8. kr11

    kr11 Well-Known Member

    Joined:
    19th Jun, 2015
    Posts:
    81
    Location:
    sydney
    Yes that is a good idea. If u wanted to accelerate your ip portfolio buildup
    boq specialist allow 95% no lmi, but any amount over 90% is treated at around 10%p+i 5yr loan
    i.e. if u did 95%loan the extra 5% would be at p+i 10%over 5years

    u would need to weigh up the cost of the extra interest that u pay vs paying lmi with another lender at 95%
    However given the fact that 95% loans are costly in terms of lmi, and also harder to get atm, the ideal situation would be 95% with boq, 1 or max 2 properties, make sure they r high capital growth properties so u can cash out a lot earlier, remember they will cross collateralise them, pay the 5% p+i loan off asap, preferably b4 5yrs and then cash out to 90%no lmi once u get growth, and then use the other lenders that i mentioned that do 90% no lmi.

    Hopefully by that time later, nab and macquarie will become actual payment lenders again, as they were b4 apra intervention.
    If u can use cba or west pac before them thats good also as they add buffers to servicing

    After u get a large no properties, hopefully with all those 90% no lmi lenders, u can use other actual payment lenders at 80%, or 90% if u do not mind paying lmi, to continue the journey

    hope that helps
     
    lauz358 likes this.
  9. patience

    patience Member

    Joined:
    20th Jun, 2015
    Posts:
    14
    Location:
    Brisbane
    Very helpful, thanks kr11. Have a clearer picture of what direction i can take now.

    Cheers