Fixed IO period

Discussion in 'Loans & Mortgage Brokers' started by housechopper2, 10th May, 2018.

Join Australia's most dynamic and respected property investment community
Tags:
  1. housechopper2

    housechopper2 Well-Known Member

    Joined:
    5th Oct, 2016
    Posts:
    493
    Location:
    Melbourne
    If someone is coming to the end of their 5 year floating IO period, can they fix their repayments for a 5 year loan term IO without reassessment? (Loan to revert to P+I after the next 5 year fixed IO term is up).
     
    housechopper2, 10th May, 2018
    #1
  2. Jess Peletier

    Jess Peletier Mortgage Broker & Finance Strategy, Aus Wide! Business Member

    Joined:
    18th Jun, 2015
    Posts:
    6,684
    Location:
    Perth WA + Buderim Qld
    Depends which bank, and if you're currently on the first or second 5 year IO period. Generally, the answer is no, you'll need a reassessment.
     
    Jess Peletier, 10th May, 2018
    #2
    Terry_w and Phantom like this.
  3. housechopper2

    housechopper2 Well-Known Member

    Joined:
    5th Oct, 2016
    Posts:
    493
    Location:
    Melbourne
    housechopper2, 10th May, 2018
    #3
  4. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

    Joined:
    14th Jun, 2015
    Posts:
    10,640
    Location:
    Gold Coast (Australia Wide)
    Unless you got a 10 year or more IO period at approval ( old CBA STG et al) then nah, ya roll to a PI

    ta

    rolf
     
    Rolf Latham, 10th May, 2018
    #4
  5. Tom Simpson

    Tom Simpson Well-Known Member

    Joined:
    13th Dec, 2016
    Posts:
    186
    Location:
    Subiaco
    It's worth a call to your bank or broker. A colleague extended the IO on his PPOR a further 5 years (second round) with a phone call to his bank recently.
     
    Tom Simpson, 11th May, 2018
    #5
  6. Jamie Moore

    Jamie Moore MORTGAGE BROKER - AUSTRALIA WIDE Business Member

    Joined:
    18th Jun, 2015
    Posts:
    3,979
    Location:
    Canberra, Brisbane and Sunshine Coast
    Unlikely these days :-( Best to contact your broker/banker directly to find out for sure though.

    Cheers

    Jamie
     
    Jamie Moore, 11th May, 2018
    #6
  7. PropertyInsight

    PropertyInsight Well-Known Member

    Joined:
    22nd Jun, 2017
    Posts:
    332
    Location:
    Australia
    Will reassessment requires credit check again? I want to revert all 3 loans with CBA, NAB, and Westpac into fixed IO. Would it be problem if I revert all loans at the same time? may the lenders question about so many credit enquiries in the same period?
     
    PropertyInsight, 28th May, 2018
    #7
  8. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

    Joined:
    18th Jun, 2015
    Posts:
    41,943
    Location:
    Australia wide
    Generally yes.
     
    Terry_w, 28th May, 2018
    #8
  9. PropertyInsight

    PropertyInsight Well-Known Member

    Joined:
    22nd Jun, 2017
    Posts:
    332
    Location:
    Australia
    maybe, I will revert one by one every 6-12 months :p And let me check my lenders about if reassessment is required.
     
    PropertyInsight, 28th May, 2018
    #9
  10. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

    Joined:
    18th Jun, 2015
    Posts:
    41,943
    Location:
    Australia wide
    Credit file hits don't matter too much. Mainly matters with those lenders doing automatic credit scoring.
     
    Terry_w, 28th May, 2018
    #10
    PropertyInsight likes this.
  11. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

    Joined:
    14th Jun, 2015
    Posts:
    10,640
    Location:
    Gold Coast (Australia Wide)
    No, if your servicing is ok and the lvrs are below 80 %, simply get your broker to make comment on the apps as to whats going on and they logical reason as to why

    ta
    rolf
     
    Rolf Latham, 29th May, 2018
    #11
Self-Managed Super - Super your way

PFI can assist you with your investment strategies for your SMSF, Life Cover for your members and assistance with compliance. We provide the research to ensure your investment selections achieve the goals. This is the value of advice