Dodgy Broker

Hey guys, I'm quite new here and just want to first say this forum has been a great learning for me so far.

My situation currently is I'm looking to do my first refinance for my property and I'm quite inexperienced with IPs in general. I just want your opinion on my current situation as I feel like I'm being taken advantage of. Would greatly appreciate any advice.

Essentially getting a refinance from a major bank and the bank's broker has said to me he is willing to waive all the fees involved (~$1.2k). However, the 'cashback' won't be available to me until a month after I settle. He isn't willing to put in writing, put it in the contract or email me a copy of this 'promotion'. He also says that he can change my investment loan into an owner occupied loan in order for me to get a lower interest rate, but only after settlement. Not sure if this is usual practice, something doesn't feel right but then again I'm quite new to all this.

Any advice on what I should do here?

Thanks!

 

He is giving you the fees back after a month because that's when he gets paid the commission on the deal. A month after settlement...

 

Banks broker? - contradiction of terms.

You mean a mobile banker? Cashbacks do usually come in about a month after settlement.

Why so much in refinancing fees?

 

Yes mobile banker. I'm also paying a 'lock in' fee for my interest rate which accounts for about 40% of the cost

 

that would be a fee for fixing, not a refinance fee, but good if he can waive it.

 

So basically my broker is waiving the fee by taking a cut from his commission?

 

Maybe. Lots of lenders have a promotion for refinances, $1200 anz and wesuck. Nab doing velocity points to about $1800. Some are restricted to OO, some do it for either OO or investment loans.

Just run the bank and the deal details via a broker and see if what you are being offered is really a good deal. If you run it past a broker from here you might also learn some useful points on structure or specific lender policy that might be worth a whole lot more than that.

 

I doubt it. It sounds like he is not a broker but a bank employee.

 

I know ANZ mobile bankers run their own business and work off a commission model (can obviously only offer ANZ product). Sounds like this might be the case?

 

Is the purpose of the loan actually owner occupier? If it isn't then don't you think its also dodgy to lie to the bank about the loan purpose?

 

It's the norm for rebates to be provided a month or so after settlement.

Having said that - I personally wouldn't have any issues putting it in writing for a client that the rebate will be paid post settlement.

Cheers

Jamie

 

I am sure you will be entitled to a cash back. Who is the lender? Most majors are running cashbacks with NAB probably the pick of the bunch.

With regards to the loan switch then he is doing this because you do not have the capacity to service the loan on owner occupied terms. He is suggesting you buy it as an investment because you can use rental for servicing.
If you decide to move into the property after renting it then you would be able to switch the loan. If you have no plan to rent the property and the banker knows this then obviously he is lying on the application.

Their is currently a gap in the banking system that allows for this. Funny thing I find is when we hear about "dodgey" finance it's always aimed at brokers. Truth is on my time in these forums I have heard wayyyyyy more dodgey things done by direct bankers.

 

It won't be in writing because it's one of the lenders that are only doing cash back for OO loans, and this trickster is doing an INV loan and then switching after settlement and then somehow getting the OO cash back.

Convoluted, complicated and difficult. Which is what franchise mobile lenders have to deal with. They can't offer a different lenders special, only their own.

 

So can you simply convert to an OO rate after settlement by ringing the bank and telling them you've moved into the property? I understand this would be unethical but is it really that simple?

 

Not always - some will want to see new servicing without the rental income. All will want evidence that you're living in it.

 

Not really. It depends on the lender. Some will want to see a utilities/rates notice with the new address. Some will want likely want a reassessment.

Cheers

Jamie

 

The broker is making these with Photoshop haha.

 

No.