Why not Liberty?

I've refinanced a couple of loans away from the non-confirming lenders over the years, but they were generally people where the reason they went to these lenders was a one off problem, not an ongoing one. It's never actually been a big deal.

The reason it might be a problem in the future for investors reading these posts is because Liberty's servicing profile is substantially better than the mainstream lenders. Even in a couple of years, people might not qualify for a loan elsewhere due to serviceability limits.

 

Depends on the deal parameters @albanga . If your going for a loan via Genworth, it will likely be one of the marginal pieces of the file that work against you. If you're going for an 80% loan (or operating within the lenders DUA), all things otherwise, i don't think you'll have trouble.

I've done a few and haven't ever had anything come up, but others here have mentioned some difficulties in getting through the insurers.

 

You wont have any issues, depending on other parameters as others have mentioned. Pepper and Liberty have migrated their businesses away from a no doc/lo doc bias towards a full doc bias, over the past few years. They are no longer viewed as just "B" class lenders.

Listen to Redom - he's a Young Gun now

 

Hi Peter,

So the only way to refinance to a different lender would be to significantly deleverage?

Another question if you don't mind. If an investor has an 88% LVR loan with Liberty, to what LVR would the investor need to reduce LVR (roughly) to be able to refinance with another lender?

Thanks.

 

@Realist35 fundamentally servicing is about the difference between money coming in and money going out. Income verses expenses. What's left is what determines how much more debt you can take on.

Liberty has a signifcantly more generous servicing calculator than almost any other lender (because of the way they calculate the expenses). To move from Liberty to another lender, you'll either have to increase your income or reduce your expenses - in a manner that satisfies the new lenders policies. Deleveraging (paying off debt) is one way of reducing expenses.

There's no point in getting an 88% loan with Liberty in the first place. Above 80% LVR Liberty are subject to their mortgage insurers lending criteria which has the same lousy servicing as most mainstream lenders. If you qualify for an 88% loan with Liberty then servicing is not the reason you're going to Liberty in the first place.

 

Very nice explanation, thanks a lot @Peter_Tersteeg

 

Their i/o offset is s bizarre offset.
What is in the offset doesn't change the interest charged so principle gets paid down. You have to call them to manually recalculate.
Then the loan is polluted by redraws etc. Messes up tax or cg calcs.

I'm going to leave them.

 

Hey @Whitecat how can you leave them? I thought that would be close to impossible and often it's easiest to sell.

 

My circumstances have improved so I believe I would finance with other lenders

 

They are a weird mob arnt they, i spoke to them about the above, weird hey!!!

 

They do not have an offset, they call it that, I believe it is poor information, I have seen people on here saying they have used it & yes, you are stuffing things up, use one of your other lenders proper offsets