Refinance question

Re: bank vals

Do they normally fall to bottom of a valuation range?

I bought ppor with 85% lvr 10 months ago and had to pay mortgage lenders insurance

The market in the area has gone up plus I've been paying extra

Based on the mid range from an anz buy ready report I would now meet 20% lvr

Just not sure if banks generally would take the mid range of a valuation

Would appreciate people's thoughts/experiences

 

Generally they are market values. But most people think their properties are worth more than they actually are.

 

What are your reasons for refinancing?

You will lose benefit of the LMI paid previously.

 

Reason for refinance is to get cheapest rate possible for a p&I loan with offset as we will be paying it off over 9 years (or sooner if we can get an even cheaper rate)

The anz buy ready report states it's not as valuation so not sure if the "mid range" of that report would represent a true market value used by a bank for purposes of lending

 

Keep in mind these are a marketing tool for ANZ, they're not what they use for valuations. You may be in a position to simply negotiate a better deal with the ANZ and avoid the costs of moving to another lender.

 

Thanks Peter that's what I thought and good point re: checking with my lender before attempting to leave.

Am hoping the valuation comes in at what that buy ready report states as the mid point.

I'm not with ANZ for the loan but used their tool to see if my thoughts around value were in the ball park

I'll be giving my lender (macquarie) a call to see if they can get a valuation to get it to the 80% lvr

And if not try with another lender. If that fails I'll just wait until the lvr gets to 80% off extra payments alone then look for better interest rate deal

 

Did you go through a broker? They should be able to get a desktop/automated valuation for you, both with Macquarie and potentially the new lender. That should clear up any potential ambiguity.

 

Valuations always have a range. The bottom is often the one lenders look at. The borrower optimistically looks at the top one. But along with a contract some may find the contract value aligns within the valuation range and accept it as supported by the valuation.

Your broker would guide all this and should know each favoured lenders approach.

 

If you order Vals from 5 different lenders, they'll likely have a ~5-10% variance between them. That may be all you need if you wanted to refi @ 80%. Macquarie charge premiums by LVR, so if your above 80% band with them, your rate will likely fall by falling to sub 80% bands with lenders.

 

My existing broker did a desktop val that fell just out of the 80lvr range

Went to another lender and they sent out a valuer

That value came back above even my expectations and now at 75 lvr

So I'll be refinancing with them for much cheaper rate and no lmi to pay

 

Which lender?

 

Valuations aren't up to the lender, they're up to the individual valuer. Lender A doesn't do more generous valuations then lender B. Most lenders simply put their valuation orders into Corelogic, which then distributes them to local valuation firms. One individual in a firm might be more generous than another individual in another firm, this has nothing to do with the lender.

 

I understand that - just curious on the lender the OP has chosen to refinance with.

 

Went with Suncorp