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PPOR Loan advice

Discussion in 'Property Finance' started by SaberX, 21st Aug, 2015.

  1. SaberX

    SaberX Well-Known Member

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    Hi all,

    Just wondering if anyone out there has any good deals or knows of any competitive rates being offered by institutions for competing for your PPOR loan?

    FHB looking to settle on a titled lot around October... access the relevant FHB grants, build house and perhaps rent out in a years time if move out.. In that regards I should still be able to access an OO loan on that basis and avoid all the chaos in the IP property loan market?

    I know there are some dirt cheap online lenders available but I'm considering my 2nd/3rd property in the portfolio in the coming years... so a lender that fits in with general portfolio and finance building would be great....

    Planning to go variable with an offset account so I can plug as much money as I can in and pull it out to invest in property 2 down the track.

    Would prefer to save LMI but at same time I want to maximise potential deposit for property #2 given how chaotic IP loan lenders are getting. Haven't heard of any successful negotiation of Westpacs 85% no LMI into OCtober or onwards, or of any competitors offering similar 85% no LMI for Owner Occupiers? If there is would be keen to hear.

    Many thanks & appreciate any advice.
     
  2. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    Depending on the LVR you should be able to get very low 4s with a major bank. They are hungry to OO loans now.
     
  3. SaberX

    SaberX Well-Known Member

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    I can afford up to the typical 80% lvr for no lmi. Just wanted advice on striking the best balance between rates and choosing the right institution to setup good access to second property in portfolio. As part of considerations i therefore was wondrring best lvr to go that strikes this balance.

    Best.compromise seemed to get something similar to westpacs no lmi at 85% going. Given settlement was by sept this wasnt workable for my oct and onwards date. Hence was wondering whether a competing offer or negotiation was out there to gain access to leave a higher deposit for the next property.

    Feel free to throw some rates up. Be keen to hear what sort of 'competition' is out there currently.
     
  4. Jamie Moore

    Jamie Moore MORTGAGE BROKER - AUSTRALIA WIDE Business Member

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    If you're going to rent it out in the future then consider setting it up as IO - however, banks are generally providing lower rates on P&I these days.

    Cheers

    Jamie
     
  5. matchsticks

    matchsticks Active Member

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    Not sure if you consider this to be competitive but a contact was recently offered 4.15% no LMI on a loan just above $350k with Westpac (LVR = 85%). Best that CBA would do was 4.3%, no waiver on LMI.
     
  6. SaberX

    SaberX Well-Known Member

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    Jamie - yes, agreed will consider IO? I can't see why not - besides a cheaper rate i assume with P & I, or more favourable products in current market? Otherwise IO seems a no brainer as it allows serviceability for your second property? At least I figured that was the smartest from a property finance strategy pov to building your portfolio?

    matchsticks that sounds decent. had friends just below 4.1% with macquarie a few weeks back... but they bank with them already and it was a simple P & loan with offset i think? Bankwest was close to 4.12% or 4.18% i think for another friend.

    My loan would be about 400-430k at this rate i reckon... contract offered did it require settlement by september?? If october-november settlement is possible then this would definitely work for me...

    are any other mid tier and boutique lenders waiving LMI? Or is Westpac so far the only one to do so at 85%?
     
  7. wylie

    wylie Moderator Staff Member

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    I'm curious to know what IO rate NAB is charging for an IP for an 80% lend?

    Son has been quoted 4.78%. Should he accept this and then push for a lower rate and see what they come back with?
     
  8. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    NAB rates are all over the place atm. It will depend on LVR and size of loan.
     
  9. wylie

    wylie Moderator Staff Member

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    Loan size will be $600K, 80% lend (is that 80% LVR? - no other loans or cards).

    NAB will be increasing its current loan so they already hold the security.
     
  10. Shahin_Afarin

    Shahin_Afarin Residential and Commercial Broker Business Member

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    You shouldn't use NAB unless there is a specific policy need (building 3 units, probation, etc) or servicing.
     
  11. wylie

    wylie Moderator Staff Member

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    Using NAB at this time is our son's best bet for various reasons, mainly because it needs to be done this week, NAB holds security already which we are hoping will mean desktop val (but waiting for confirmation), part of the loan is fixed but will be broken as moving from part fixed/part variable plus increase and then all going to IO variable. The cost to break is outweighed over the next twelve months (twofold or more).

    We did approach a broker, but this is quickest and easiest for now. Once son pulls more money out, he can look at refinancing or at least push for a lower rate.
     
  12. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    4.78% is the standard rate for 80% or over LVR IO. If you were to drop it to 79% the rate would drop to 4.73%
     
  13. wylie

    wylie Moderator Staff Member

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    Thanks Terry.
     
  14. SaberX

    SaberX Well-Known Member

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    How about OO interest only loans rate %'s these days? If variable? Doesn't seem to be many brokers commenting on what clients are getting these days on these? Talking to westpack their rocket loan is at best around 4.58%, he's seen some go down to 4.48, 4.5% but this seems quite high to me?? Especially given friends were getting circa 4.09-4.18% for macquarie versus bankwest on their purchases in the last month or so?

    Are the big 4 that much higher than the competition (circa 4.5% and above) and if so is the only reason to not go a cheaper rate the flexibility in future mortgages to aid your portfolio financing strategy/growth?

    Otherwise tempted to go to lenders which offer sub 4.2%, rightfully given the current cash rate is down... likely to continue so.

    Judging by the lack of broker response - it appears no one else has secured no LMI for 85% LVR or so to match Westpacs? Confirmed with Westpac that loan still must be applied by 31 Aug and settled in September, so no hope for a October-Novemeber settlement for me...
     
  15. SaberX

    SaberX Well-Known Member

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    Given the westpac loan rep yesterday quoted me the lowest around circa 4.5% for their rocket loan, how did you get 4.15% Was this the no frills, no offset account etc that you got to get that low a rate?
     
  16. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    Got a client 4.12% the other day. All depends on the deal.
     
  17. Shahin_Afarin

    Shahin_Afarin Residential and Commercial Broker Business Member

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    Citibank do no LMI @ 85% and Homeloans (aka Resimac) do no LMI @ 85% plus they don't credit score.

    Rate isn't as sharp as Westpac though - basically anyone at any LVR (even 97%) is getting 4.20%.
     
  18. SaberX

    SaberX Well-Known Member

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    Terry could you elaborate at least on lender and if loan had some frills at least? I.e. Offset account?

    Shahin thanks. Was that a typo? So your saying westpac does below 4.2%? If so this must be the no frills variable rate loan? Or can you obtain these sort of 4.2% and below rates for your clients these days whilst still getting a variable loan with frills such as the offset account?

    How are citibank and homeloans fit into the portfolio strategy for investors in terms of ease of refinancing equity out for future deposits, valuations, borrowing calculations? Are they pretty tight?

    If their credit card account facility was anything to go by citibank had been abit of a nightmare as a retail customer...
     
  19. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    Westpac - offset and all bells and whistles. owner occ
     
  20. Jess Peletier

    Jess Peletier Mortgage Broker - Australia Wide Business Member

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    A lower rate than that could definitely be negotiated with Westpac. Why are you dealing with the Westpac rep? WBC and St G are the only lenders offering 85% no lmi, other than Citi who always do. Their rate are high though.