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Westpac no LMI 85% LVR for PPOR's

Discussion in 'Property Finance' started by Shahin_Afarin, 3rd Jul, 2015.

  1. Shahin_Afarin

    Shahin_Afarin Residential and Commercial Broker Business Member

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    Lenders are hungry to balance their investment/owner occupied loan books and none more so than Westpac.

    As such they are rolling out no LMI 85% LVR for all owner occupied properties.

    The loan will be assessed as per LMI conditions but Westpac will pay for the LMI. The property must settle by the 30th September 2015.

    Interesting to see if any lenders with high investment loan books will follow.
     
  2. Redom

    Redom Mortgage Broker Business Member

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    Very creative offer. I suspect this will generate a lot of additional PPOR business for them.
     
  3. pinkboy

    pinkboy Well-Known Member Premium Member

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    How will they police the PPOR 'condition'?

    People's circumstances 'might change' after settlement.......

    pinkboy
     
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  4. D.T.

    D.T. Adelaide Property Manager Business Member

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    And how will poor first home buyers come up with 15%. This is an outrage.
     
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  5. Redom

    Redom Mortgage Broker Business Member

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    Its true - they won't be policing it. Situations can change and they won't want an update on it (+ APRA won't know any better!)

    But from a serviceability perspective, many investors require the rental income from that property to service.

    So there's one indirect 'control' in there.

    Cheers,
    Redom
     
  6. Jamie Moore

    Jamie Moore MORTGAGE BROKER - AUSTRALIA WIDE Business Member

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    Would be difficult I suspect. Like you said - plenty of people convert an owner occ to an IP down the track.

    Hopefully they don't pull the plug on this early like ING did with their one week 90% no LMI promo.
     
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  7. pinkboy

    pinkboy Well-Known Member Premium Member

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    That doesn't make sense.

    If Westpac think it's a PPOR, there is no rental income anyway.....

    pinkboy
     
  8. Investig8

    Investig8 Well-Known Member

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    Have you heard if this applies to existing customers looking to refinance or new customers
     
  9. Big Will

    Big Will Well-Known Member

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    Would they consider rent if you rent out your current PPOR (now IP) to buy another PPOR?
     
  10. albanga

    albanga Well-Known Member

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    May sound like a silly question but what happens if you still want to borrow at 90%.
    Will the premium be based on 10% over LVR or 5%?
     
  11. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    Yes
     
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  12. Redom

    Redom Mortgage Broker Business Member

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    Thats true pb.

    Point was an investors borrowing power is significantly greater with the rental income being used than for a PPOR purchase (assuming they're coming of a base where there's no other rental cost thats offsetting it).
     
  13. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    90%
     
  14. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    Westpac were the only real maintstream lender that provided this little space post gfc.

    Can be a sensational option for a debt recycling strategy because of the extra 5 % investable capital

    Ta

    Rolf
     
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  15. Watson1

    Watson1 Well-Known Member

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    When does this offer begin?
     
  16. Peter_Tersteeg

    Peter_Tersteeg Finance broker and strategist Business Member

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    In VIC you sign a PPOR Stat dec which tells them fairly clearly what it would be used for.
     
  17. Arashi87

    Arashi87 Well-Known Member

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    However its interest rate will differ alittle ? Probably 0.25% + than the current rate?
     
  18. Shahin_Afarin

    Shahin_Afarin Residential and Commercial Broker Business Member

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    Offer starts 8th July and settlement must be by 30th September so not a huge window. Depending on how successful the campaign is they may extend (I don't think they will though).

    Rate isn't going to be higher as Westpac doesn't price on LVR. The assessment of the application will be based on LMI rules/policy.
     
  19. jpcashflow

    jpcashflow Well-Known Member Business Member

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    Hi, so will you be comfortable if Westpac sent all of your mail to the new PPOR?
     
  20. kamchatsky

    kamchatsky Well-Known Member

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    This offer was how i got onto property market in 2007 when me and my wife bought our PPOR (and our first property) in Cherrybrook (still living there now). Only Westpac has this offer at that time which allowed us to borrow more than usual without LMI and get the house we want (4 bedder for long term family planning).

    Sure I can borrow with other banks but my wife hated paying LMI at that time, so I am thankful with Westpac with that option at that time.
     
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