Liberty IO rate increase

They not under pressure from APRA yet, but that is likely to change (and gawd knows what they will do to people if/when that happens)

They can be useful to get some things done, however of late they have gone from what appeared to be a business wanting to go more main stream and be somewhat competitive, to one that just hits borrowers at every turn.

Lets just put it this way, if your looking at a neg geared blue chip place where at todays rates you will be buying all you can afford and paying full price etc, not good to go with them.

If you have a fantastic deal, servicing is tight, and you do not want to lose the deal because there is quite a bit of fat on the deal, or you know with some minor spending it can be transformed etc, then the rate does not matter as much as getting the deal done. Do the deal and then re organise finances after, or wear the cost is it is budgeted for.

 

I do not have anything with them ATM, I moved because I could not fix, but the rate was a lot more reasonable, fees more reasonable, all round I liked them apart from no fixing.

Yes, I think they will adjust, but call them up, I never asked specifically.

Servicing is tighter though IIRC, I know I can still use them but not sure of exact difference right now, if staying variable I would go to them first, but I heard they are in the middle of a buy out now, look into that.

PS I will have a look later & see if I can find a period with similar loan/s and LVR, and will PM you the difference.

 

Of course they do lower. Every lender has different rates for different LVR including Liberty.

I haven't delved deeply into the lenders but I did lodge a comparison on Lendi, Ratecity and Finder and had those representatives call me and said refinance at 90% LVR away from Pepper was not going to be a difficult task.

Just had a quick look few institutions still lending 90% LVR on those websites (i.e) Heritage Bank, IMB, SCU, Newcastle Building Society, State Custodians, QT Bank, CUA - theres heaps actually.

Not sure if the websites are up to date but the above its just going by them. Call them up doesnt hurt and by talking to numerous brokers recently in the last few weeks they seem to think its ok.

 

Hang on a tick....

Have you actually done this with them, not a new loan or a refinance, but paid for a val and then had them apply a lower rate too an existing loan without taking new money or changing product ? I seem to recall having done this and no rate reduction was possible, I could be wrong though as it was a while ago.



Re other lenders, well, I do not care about websites or what sales staff say on a phone call, I actually put in applications for real loans and take into consideration impact of say LMI calcs as well, all well and good to read something on a website, actually getting a formal approval is quite different.

Also as you may or may not know or have read, lenders change the servicing calcs *a lot*

I also use brokers, never direct, but that does not mean I won't go direct if there is no way to use a broker and a lender is decent.

 

Yes I have in the past. But I am not with them now and moved all my stuff to Pepper. I dont like Liberty they ****** me off in the past and I dont like Pepper now either so I'm looking to refinance shortly. And I've also just re-evaluated my investment (actually 3 of them) and reduced the interest rate with Pepper as well (without changing products or taking more money). my interest rate reduced by 0.41 points going from 90%LVR to 80% LVR.

I'll keep you updated on the others. I am lodging the paperwork this week to refinance through Lendi. I believe we are going to try IMB first if not others.

Like I said you haven't even tried yet either so might as well try instead of assuming. At least I've contacted them and a broker has advised me that its possible. Your just assuming.

 

What don't you like about pepper? Just curious because our next purchase will be with them at 80% lvr.

 

Lets just say I had a big argument with them regarding reducing my interest rate after the valuations and them not honoring something which they told me they would do.

They are not too bad. Alot better than Liberty but stuff them I have 4 loans with them so if they want to continue to have my business at least keep your word in business.

I'm a very big believer in business you do what you say and your word and guarantee is solid and dont **** around.

 

Yes, I know Pepper do this, I am not sure about Liberty, I am not sure whether you are saying 100% you can or not, it is not so important to me, but may be too others.

Yes, let us know, I have thought about some of the others too, but my brokers do not use them, maybe there is no channel ?

I am not assuming, I am in the middle of some finance changes now & have finished what else I wanted to change over a period, I may be doing another buy soon, but am not lodging now and as said, things change quick, I won't be doing any 90LVR though, Pepper offer an 85 without having to use the big insurers calcs, so prob will go with them if no changes. I am not claiming to know everything, so far I have kept my comments to Liberty and Pepper here.

The reality is, ATM, that what is involved this month will be different next month, most here will be doing 80LVR, so it is good if we share what we know to the best of our knowledge & of course the brokers here are all very helpful and share often, they can probably correct some of the things discussed.

 

What was the argument ? What did they do ?

I found them to be pretty much up front, although I was using a broker and a third party, which means I did not deal direct with Pepper staff.

PS they are all getting a bit iffy and picky I think & they do not care if people move IMO, swings and roundabouts.

 

I have not looked, but the rates were reasonable when I used them, they could do most things, but I could not fix, I would use them for new buys that will be on variable if nothing much has changed.

 

Yep I agree with this. Brokers have their preferred lenders and dont have access to other lenders so it can be a hit or miss there. TBH I dont care which lender/broker I use and I will try with every lender there is.

I guess you have to look after yourself when it comes down to these things. Let me know if you find any others that is worthwhile looking at. I'm thinking very hard to move away from Pepper.

 

I can only assume you guys are with Liberty and Pepper because you didn't service with more savoury lenders....which makes refinancing to someone 'better' nigh impossible??

 

Prefer not to give the details. I will when it comes to an agreement.

Went with Pepper/Liberty because finance gets very hard when you reach 20 properties. I have a bunch with the big lenders as well CBA/ANZ/Westpac. Also a tonne with non conforming lenders.

You will get to a point where its inevitable.

 

wouldn't it put bad marks in your credit file, if you went with multiple lenders said no to your application? Even if it was successful, havin many access to your credit file raise suspicion to a lender?
I would think most small non conforming lenders get freaked out when they see you have more than 10 properties?

 

Umm, no, not exactly.

I have avoided the big 4 for a long time & when I took a Liberty loan at first, it was because my second tier lender really tightened and because I thought I would give them a go. I took other loans with other lenders as well, I did go back to one of the big 4 when first changes came in and the rate was more than Liberty at that point, but at that time, Liberty had no large app fee, only fee was a 300 odd per year (similar to larger lenders). I am not comparing or saying Liberty and big 4 were same, the loans *were* different & Liberty one taken when rates had dropped as well.

When they started playing silly buggers, well then they became the "lender of last resort" in my eyes too. Charging extra whatever it is if you own multiple places....well....

The APRA changes and change of market, combined with fees, charges and the offering, that it now only suits certain deals IMO, I think what happens is you start to look at many more options than if fees etc were kept reasonable, you would not look until you reached internal limit.

Clearly they also have a big advantage in servicing. Things are different today.

Pepper was by accident, I applied through a third party, I was thinking that third party only got funds from one source, when the offer came back the funds were from Pepper, it was some time ago, but my experience was that Pepper not same as Liberty, and the calcs not the same today too.

The brokers would know more, but Pepper seems to be a more in the center, I would use them for variable still, I do not look down on them, as long as fees etc are fair and close to competitors.

 

Nah the trick is to run the numbers before anything gets lodged. The brokers I have worked with are pretty good in terms of whether or not you will get rejected so they wont officially apply unless they are almost certain you will get it.

Every bank blinks twice when your numbers get up there.

 

My credit file for years would look like a target for a machinegunner after a full days practice....

You do not apply for what you know won't be successful, people in credit are not stupid, they will see everything matches & they can ask for whatever they like.

I think one non conforming lender would be rubbing hands together, do not forget, they know what your worth and LVR etc.

 

yes your personal broker will check the numbers, but wasn't sure if one goes directly to those small lenders that isn't in your broker's panel. some of these are basically no frills online and dip into your credit file without 2nd thought.

 

Well, all I can say is anyone currently with Liberty and Pepper should brace to be ripped a new one - sooner or later.

The strategy is simple - get as many investors/applicants who can't service with the banks into their domain, then expose them to death by a thousand cuts (or raises).

I very recently ported 2 loans away from Liberty when I saw the writing on the wall - and I didn't go in with my eyes closed initially either.

I'm paying just under 4% now fixed for 2 years (albeit P&I) - if I was with Liberty, I think I'd be staring down the barrel of a 5.24% IO rate judging by what some posters are saying the latest round of increases are.

 

Yeah, I think you did well, think were on the same page. 5.24....lol, that is cheap, I think they must be at 6 or more if anyone did a 90LVR IO & multi property.

PS where did you go for that rate (PM if you like)