Poll: Will you/Are you using non-bank lenders to keep buying? (Pepper, Liberty etc)

Discussion in 'Loans & Mortgage Brokers' started by Blueskies, 7th May, 2018.

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Will you/Are you using non-bank lenders to keep buying? (Pepper, Liberty etc)

  1. Yes - Using already

    18.8%
  2. Not yet but likely will down the track

    35.4%
  3. Undecided

    10.4%
  4. No

    35.4%
  1. Blueskies

    Blueskies Well-Known Member

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    From everything I have read it would seem that soon or later most investors will be faced with a choice of either using non-bank lenders not restricted by APRA guidelines (for now at least) or sitting on the sidelines for a few years at least.

    I am a bit uncertain how I feel about this. the thought of being boxed into a corner unable to easily refinance and the risk of higher rates makes me uneasy, but at the same time there is the lost opportunity risk in being sidelined.

    I recognise that there are other options to increase cashflow through more active strategies which I think can be done in parallel but for the purpose of this poll I am just interested in the amount of people using these lenders and also their experiences if keen to share?
     
  2. jins13

    jins13 Well-Known Member

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    19th Jun, 2015
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    Sydney
    Great post @Blueskies. Personally for me, any future deal needs to pass my version of the sniff test for me to consider making additional purchases. In saying that, I do feel that extracting equity is going to be a challenge in the future with all the changes that's happening. Atm, trying to move the last loan I have with Liberty because I am sick and tired of paying 6ish interest rate.

    I think your strategy of improving cash flow is a great thing and something which I am also concentrating on as well.
     
  3. MTR

    MTR Well-Known Member

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    Then go RAMS lo doc
     
  4. euro73

    euro73 Well-Known Member Business Member

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    The beautiful Hills District, Sydney Australia
    Thats not available unless you are self employed with ABN 2 years and GST rego 2 years...

    Not much good for PAYG borrowers.

    You should open a RAMS franchise... :)

    Adelaide Bank offers the same " no look " lo doc as RAMS, in case anyone is interested in an alternative...
     
  5. MTR

    MTR Well-Known Member

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    Always Happy to help fellow investors:);)
    Do a search if interested....Started a thread on this product.
    Its been flying under the radar on PC, I wonder why Euro:rolleyes:


    RAMS lo doc - Great product
     
  6. Tranquilo

    Tranquilo Well-Known Member

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    18th Jun, 2015
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    469
    Location:
    Mascot
    I voted no even though I could have got a 4th property through pepper, but the feeling of being trapped I didn't go ahead. I'm going sit out for few years and reduced debt.
     
    Perthguy and Redom like this.
  7. Jess Peletier

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

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    Perth WA + Buderim Qld
    Brokers can refer to RAMS, and I do when the need arises. Their lo-doc is good, but as we've said before PAYG borrowers can't access it so it's actually not useful for the vast majority of borrowers.
     
    MTR likes this.
  8. MTR

    MTR Well-Known Member

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    Great, I know quite a few investors who have used this product
     
    Jess Peletier likes this.
  9. euro73

    euro73 Well-Known Member Business Member

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    Location:
    The beautiful Hills District, Sydney Australia

    I dont need to do a search. I know all about it
    It hasnt been under the radar - its been mentioned many many times.... as has the Adelaide Bank smartdoc product But its a lo doc product with 2 year ABN and GST rego required. So again... only suitable for some. Most people cant access it
     
  10. Blueskies

    Blueskies Well-Known Member

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    Interesting spread of results, looks like the majority are either looking to use these lenders down the track if not already using. I suspect as well there would be a portion in the no voters who are at a stage where they don't need to/aren't seeking finance anyway.

    @jins13 you mentioned that you are paying a 6ish interest rate, is that the main reason you are wanting to leave Liberty? How have you found them aside from that?

    A lot of the comments I see on Product Reviews say that the rates are higher for these lenders, (as you would expect) with rates being raised faster than banks and falling much slower. Obviously some of the people leaving those comments are distressed lenders/behind on payments, curious to know where the rates currently sit for borrowers with good repayment history, no defaults/missed payments etc. Surely they can't turn the screws too hard on every borrower because there are still refinancing options in that smaller pool of non-bank lenders?

    A quick look on loan comparison websites has % sitting at high 4s low 5s for Pepper and Liberty. Is this for new business and then they ratchet up the interest rate once they get you on the hook?