mortguage broker obtaining 250k more

so im with cba, then i went to see a broker and he can get me 250k more than cba can offer - same parameters, income, debts, securities, etc.
have i missed something fundamental here? is this a recipe for success or disaster ?
becos additional funds is offered / available, doesnt necessarily mean i will borrow it all, but how is this possible ?

 

If all finance products were the same, and brokers could only find identical products as the bank you're with then what would be the point of their existence? Brokers are the go. Sounds about right to me.

 

Different banks have different lending criteria. This results in different amounts they can loan under different circumstances. I've seen cases where one lender won't give someone a cent, whilst another will be willing to lend millions.

 

That's the point of seeing a broker, they can find you the best possible deal.

 

I've had one, also with CBA, I was able to get an extra $250k out with CBA just by doing things in particular order, whereas others told me it was $0.

 

There's a few tricks we can use to improve servicing either with the same or different lenders - that's why speaking to a broker is always a good idea. It's just a matter of knowing the way lenders assess servicing inside out - something even bank staff sometimes don't understand or think too hard about.

 

Are the numbers different just with the CBA calculator? If so, That's quite an unusual amount between two different calculations on the same calculator. Possible reasons:

1. One is doing it via a top up and the other as an equity pull (separate loan). CBA have a quirky method of calculating your repayment amount and it does differ (greater borrowing via separate loan) depending on the method chosen.

2. Income calculation differences - I've recently done a commission + self employed side business deal where client had a large increase because one person didn't use income that CBA would accept (with additional verification of course).

I'd ask both brokers for inputs into the calculations and see how the difference arises.

 

Is the broker using CBA as well or a different lender? If CBA - then that's quite strange. If it's a different lender - then I'm not surprised.

Cheers

Jamie

 

Im reading it as a different lender.

 

nope. not diff lender. CBA said X, broker said x+250k (with cba)
i asked broker can yoou squeeze cba specifically cos theyre my bank, or see if you can better them

 

Broker may have made a mistake - get a second opinion as you don't want a decline. But it may be that the bank did not include projected rental income? This has happened before- just due to inexperienced bank staff.

 

Different info has to have been input into the servicing calculator as there is no "loyalty option" drop down box.

Once the required info is entered, which essentially is money in v money out and the difference can be used to service debt.

With the CBA calc they give a max borrowing figure at the bottom of the calc based on information input by banker / broker supplied by you which can be interpreted different ways. The "acceptable" way will be dictated to by the bank.

There are some manual calculations required so maybe they where not done or done differentley?

 

I had an assessor calc existing debt at 7.25 last week

 

Easy enough for either the assessor or the broker to make a mistake. I can see how it can go either way. The CBA calculator is not difficult to use, but can be misinterpreted. It could easily be made more user friendly.

 

In that case, I'd say that each is inputting different figures into the calculator either because they have misunderstood something or either has made an numerical error.

 

i got both cba lender and broker to double check figures. theyve inputted the correct figures. i asked the broker how is this so different. his response was, cba are doing a comparison of 7% hence why theyre offering less, and also he reckons moving fwd they MUST input monthly living expenses based on what govt tells them, e.g. 3300 per month for a couple so thats the reason too. debatable whether a couple has livivng exp of 3300 a month - thats another debate for another day

 

7% for existing debts isn't the CBA policy. It's a bit more complicated which is why mistakes are easily made here, but the true policy is actually more generous. That's probably the reason why the broker is able to indicate a higher borrowing capacity.

Living expenses have a minimum value. Your profile might indicate living expenses of $3300 per month. If you put in $2000 it'll default to $3300 anyway. This only makes a difference if you put in a figure higher than the minimum, not lower.

 

The govt doesnt dicktate what monthly expenses a bank uses in serviceability.