MELBOURNE MORTGAGE FINANCE LENDING UPDATE – 24.09.18

PRODUCT OF THE MONTH

• loan up to 95% of property value…..ideal for First Home Buyers who want certainty of repayments
• 3.62% fixed for 2 years / 3.73% fixed for 3 years
• must be coupled with a variable rate loan split / minimum $30,000 with “offset” savings account
• $299 settlement fee, nil valuation fee, nil monthly fee, $299 annual fee
• cash required : 5% deposit plus lender’s mortgage insurance (LMI) premium….no stamp duty up to $600,000

TIPS FOR FIRST HOME BUYERS

• loans are available up to 95% of property value, but LMI is required on loans over 80%
• LMI protects the lender against any loss, not the borrower
• with lenders tightening their criteria, obtaining “pre-approval” is essential
• set out a clear buying plan before purchasing : price limit, savings target, loan amount, possible lenders
• engage a good conveyancer to check the contract and complete the settlement on your behalf
• aim for: steady savings record, steady employment record, clean credit report, good documentation

A REVERSE MORTGAGE LOAN CAN FUND AN AGED CARE BOND

• entry into an aged care facility can involve an accommodation bond of $400,000 or more
• if a senior citizen owns a residential property, then a loan can be arranged using that property as security
• in many cases, it is not necessary to sell the family home to fund access into an aged care facility
• loans of up to 50% of the property value are available, depending on the age of the applicant
• an authorised Enduring Power of Attorney can apply for the loan on behalf of the applicant
• 6.29% variable rate, $495 establishment fee, no monthly fee, no annual fee, up to 5 year loan term

IF YOUR BANK SAYS “NO”, ALTERNATIVE LENDERS ARE AVAILABLE

• the Royal Commission into banking is causing many lenders to tighten their loan criteria and requirements
• non-bank lenders offer a wide range of loans to customers who no longer meet mainstream bank criteria
• loans can often be arranged in the following circumstances:
• late or missed payments on credit cards / imperfect Credit Report
• mortgage arrears history on existing loan
• unlimited debts to be consolidated
• unreasonable bank restrictions due to age of borrower
• self-employed applicants who don’t have perfect tax return income proof

USE A DEPOSIT BOND WHEN CASH IS NOT IMMEDIATELY AVAILABLE

• immediate cash may not be available when a deposit needs to be paid on a property purchase
• Deposit Bonds can be used as an alternative to cash and represent an assurance (by QBE) to pay a deposit
• Deposit Bonds can only be used where finance has already been approved, but the 10% deposit is unavailable
• Deposit Bonds can be used as a deposit for a purchase in the following circumstances:
• First Home Buyers who have a Parental Guarantee home loan approval, but don’t have cash
• investors who have good equity in other property, but don’t have cash
• home owners who have sold a property unconditionally, but don’t have cash
• Bonds can be SHORT term up to 6 months or LONG term up to several years for “off the plan” purchases
• A Deposit Bond must be acceptable to the vendor in lieu of a cash deposit

 

Contact Melbourne Mortgage Finance on 0437 417 042 for further loan details

Barry LeBrocq

Melbourne Mortgage Finance
Patterson Lakes, VIC 3197
Mob 0437417042
Web www.melbournemortgagefinance.com.au

Disclaimer: The above information is intended as general information only and does not address specific personal situations. Loan products, interest rates and fees change frequently without notice. Please call Melbourne Mortgage Finance to verify details and discuss your specific needs and loan eligibility.