All Topics / Finance / 40 year mortgages and 140% LVR’s

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  • Profile photo of Fast LaneFast Lane
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    @fast-lane
    Join Date: 2004
    Post Count: 527

    In the latest API these types of loans were mentioned. Is there any word on the street as to what might come of these products in the Australian market?

    Profile photo of foundationfoundation
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    @foundation
    Join Date: 2005
    Post Count: 1,153

    I can’t see any call for them myself. What would be the proportion of interest payments to capital over 40 years![blink]
    I guess the credit card brigade might think it was a good deal though!

    Profile photo of Stuart WemyssStuart Wemyss
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    @stuart-wemyss
    Join Date: 2003
    Post Count: 598

    I don’t think so but who knows.

    In my opinion, the amount of money lenders allow people to borrow is high enough.

    What needs to change is the standard mortgage insurance policies. For example, you can borrow 95% up to a max loan of $500k. This needs to be increased to $750k (or higher) in Melb & Syd. You can’t buy much in Melb & Syd for $500k in suburbs close to the city. I can see this changing.

    Cheers

    Stu

    Profile photo of FWFW
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    @fw
    Join Date: 2002
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    I agree with Stu.
    I constantly get frustrated by the mortgage insurance limits. With only 2 insurers, buy more than $1 million of property and your loan options (particularly if you’re self employed!) shrink to almost nothing unless you’re willing to pay double digit rates or find 30%+ deposits.

    Keep smiling
    Felicity 8-)

    Profile photo of TerrywTerryw
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    @terryw
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    Hi Felicity. There is another one now! I think they are called “The Mortgage Insurance Company” or TMIC. The cover First Mac’s loans (and others maybe), and First Mac do offer low docs. So that may be another avenue for you!!

    Terryw
    Discover Home Loans
    Mortgage Broker
    North Sydney
    [email protected]

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://www.Structuring.com.au
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au

    Profile photo of FWFW
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    @fw
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    Thanks Terry, I’ll check this out.

    Keep smiling
    Felicity 8-)

    Profile photo of woodsmanwoodsman
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    @woodsman
    Join Date: 2004
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    Terry,

    Aren’t they also owned by GE? Not sure if they are chasing a different market or playing in the same arena as GE & PMI.

    Profile photo of ple7ple7
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    @ple7
    Join Date: 2005
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    hi fw and all – so this MORTGAGE INSURANCE that we have heard of for years – is that only through 2/3 companies in all of australia?

    peter

    mt gravatt east

    mighty LIONS territory!!

    Profile photo of TerrywTerryw
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    @terryw
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    Woodsman

    I am not sure who owns them, but their policies are different to GE. eg. they will do inner city, will also do low docs credit impaired up to 95% etc.

    Terryw
    Discover Home Loans
    Mortgage Broker
    North Sydney
    [email protected]

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://www.Structuring.com.au
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au

    Profile photo of FWFW
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    @fw
    Join Date: 2002
    Post Count: 478

    Hi Peter
    Yes, it is. It’s very frustrating if you have plans for a large portfolio!
    I remember when I started out I was mainly looking for high LVR and low interest rate.
    Now I think about if it’s mortgage insured and who by, what sort of deferred establishment fees there are etc etc
    Funny how your focus changes!
    Mind you, I’d still like higher LVRs…. hehehe

    Keep smiling
    Felicity 8-)

    Profile photo of Nat RNat R
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    @nat-r
    Join Date: 2004
    Post Count: 224

    They are owned 50% by GE and 50% by Allco

    Profile photo of Robbie BRobbie B
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    @robbie-b
    Join Date: 2004
    Post Count: 2,493

    There are only two main players in the mortgage insurance game. These are Genworth and PMI…

    http://www.mortgagepackaging.com.au/index_files/mortgage_insurance.htm

    As well as these two, there are many other mortgage insurace companies but they only insure the lender that owns them or closely affiliated groups. They allow these lenders much more flexibility and to charge a large fee to do the higher risk loans.

    I personally would love to own a mortgage insurance company.

    Robert Bou-Hamdan
    Mortgage Adviser

    http://www.mortgagepackaging.com.au

    Investor Links

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