All Topics / Finance / Which loan?

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  • Profile photo of somewhereovertheresomewhereoverthere
    Member
    @somewhereoverthere
    Join Date: 2006
    Post Count: 16

    I'm looking to find the best loan for purchasing a PPOR. The details are as follows:

    Purchase price: $300,000
    Market value: ~$320,000
    No deposit
    FHOG eligable
    Looking to do renovations at some stage – flexibility?
    Would prefer ability to fix rates for first 3 years

    In the short term looking to decrease our repayments, but in the long term looking to add extra repayments.

    I've had a look at a few loans and so far Advantage finance, Virgin, and RateBusters seem ok. Any opinions or help?

    Thanks very much!
    Helen

    Profile photo of LookBeyondLookBeyond
    Member
    @lookbeyond
    Join Date: 2007
    Post Count: 4

    Hi Helen,

    You can fix for 3 or 5 years and arrange for interest only for the first 5 years. Splitting the loan and having a variable portion will allow you to redraw later down the track for renovations….on this portion you can arrange to pay p&i.

    As for the lenders you mentioned they will only lend you the purchase price amount, not the market value. There are only a select few that will consider a favourable purchase….as mentioned in an earlier forum.

    Thanks,

    Bianka

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    Profile photo of Richard TaylorRichard Taylor
    Participant
    @qlds007
    Join Date: 2003
    Post Count: 12,024

    What is the 3 year fixed rate  Advantage finance, Virgin, and RateBusters are currently offering ?

    Richard Taylor | Mortgage Broker helping investors build their wealth thru property
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    100% Investment Finance now available on selected properties. Email us for further information.

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,213

    What about a 100% loan with St George which can be IO. They also have a new product which is 100% LVR and no LMI but a higher rate.

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    https://terryw.com.au/
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    Lawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://Terryw.com.au/

    Profile photo of v8ghiav8ghia
    Member
    @v8ghia
    Join Date: 2005
    Post Count: 871

    Hi somewhereoverthere. There is no real 'best loan'. That said, there are some beauties. A lot of the cheaper ones (like advantage and virgin) brokers don't like because they don't get paid much or cannot access – and yes, they ARE cheap, good basic loans- Advantage in particular. That said, they are designed for people that are happy for a 'quicky loan', and know what they want – often happy to 'do' over the phone -in all fairnesss, if you are getting what are effectively wholesale rates you cannot expect more. But as you are chasing a 100% loan (effectively)some of the non banklenders are great – check out RAMS and wizard. St.George also do a 100% but via the branches can take a long time to get sorted. BUT, on any loans over $250k, it is often a so called 'pro pack' from a bank that offers a discounted rate, in exchange for an annual fee, that evens the playing field – and the only way to to a loan like that is via a good broker, unless you have hours to spend chasing up ignoramous bank personel that in most cases are bordering on brain dead financially.). Also, someone such as a broker or experieince 'non bank' lender will have done far more training, and have more 'hands on' experience than most 'bank lenders' – invaluable when it comes down to assistance with loan structuring ideas, and a bit of free advice…..which is worth $$$ more than shaving off a fraction of a percent on an interest rate!  All the best with your purchase. (Also – bear in mond many lenders allow you to pay extra off fixed loans now with no penalty – win win) 

    Profile photo of somewhereovertheresomewhereoverthere
    Member
    @somewhereoverthere
    Join Date: 2006
    Post Count: 16

    We have dealt with St George previously and were not at all happy with the service and length of time it took to finally get our loan rejected (5 weeks – the length our subject to finance clause stipulated). They are also incredibly inflexible in assessing individual circumstances (husband is a sub-contracted employee and therefore needs 2 years worth of income, however was an apprentice just under 2 years ago – will never be an apprentice again but the bank only looks at the dollar signs). Was looking for a lender not of bank origin.

    I've heard bad things about RAMS….don't know if it's true or just rumour.

    Mortgage broker was very helpful, but limited to the mainstream loans – we are interested in something a bit more outside of the box – hence the wholesale and internet/phone only loans. Not being able to access a branch is of no concern to me, seeing as I very rarely use one anyway.

    Profile photo of Alistair PerryAlistair Perry
    Participant
    @aperry
    Join Date: 2004
    Post Count: 891

    "Mortgage broker was very helpful, but limited to the mainstream loans – we are interested in something a bit more outside of the box – hence the wholesale and internet/phone only loans. Not being able to access a branch is of no concern to me, seeing as I very rarely use one anyway"

    I'm sorry to inform you, but these small lenders generally are not the source of the money you lend, the money comes from a small number of wholesale funders and they are all securitised, hence mortgage insured, there is consequently very little difference between credit criteria of any of these lenders. As an example, Virgin loans are rebadged Macquarie Bank loans.

    If you want something outside of the box you are far better off using an experienced broker.

    Regards
    Alistair

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