How We Work

We begin working with our clients by discussing their current mortgage situation and their overall financial goals. We look at specifically what you wish to work on immediately, as well as what you want to do in the future, so that we can create a mortgage structure that is as flexible and robust as possible.

Our initial meeting takes 45 � 60 minutes. This is a free service. If we decide to work together and proceed with a mortgage application we charge our fee to the banks, not you. So it�s a win-win situation!

Loan structure

We believe that our client�s future plans should be reflected in the structure of their lending. We ensure that lending is stand alone, not crosse collateralised and split where appropriate. To reduce banking fees we often recommend a �Professional Package�. In order to maximise serviceablility we suggest interest only loans. And seek opportunities to increase the equity accessed, whilst minimising the costs, such as LMI, of lending.

Cross Collateralisation

Where a bank has security over more than one property for one loan the loans are said to be Cross Collateralised. Some reasons for avoiding this are:

1. Proceeds from a sale can be reduced. If you decide to sell one property the other could be revalued at a reduced rate. The bank could require some of the proceeds of the sale to be paid back to them.
2. It may reduce the value of refinancing. If one property increases in value, and the other decreases the overall value may be the same and no more equity is available.
3. Default response. In the unlikely event of a default, if the properties are cross collateralised the bank will freeze both assets in order to satisfy the debts of one.

Mortgage Insurance

This is a fee paid to an insuer who guarantees that if you default on your loan that the bank will get their money bank. The fee can be up to 3% of the loan. There is no benefit to the borrower. The fee is passed on from the bank to the borrower.

Interest Only

This is a type of loan repayment where only the interest charged is paid by the borrower. No capital contributions are required. Additional repayments are possible unless the loan is a fixed rate loan. Interest Only repayments are a popular tool that investors use to maximise their serviceability.

Trust Structures

Including Discretionary Trusts, Company Trusts, Unit Trusts and Hybrid Discritionary Trusts (HDT)s are popular vehicles for purchasing investment properties. The advantages of these structures include asset protection and income distribution. The disadvantages include limited lenders and more expensive tax accounting.

Low Doc and No Doc Loans

Low Doc loans require no income verification. The applicant provides an income declaration.

No Doc Loans require no income verification (as above) and no verification of assets and liabilities.

Rate negotiations

Banks and Lending Institutions offer special deals from time to time. Being able to time a refinance or purchase to coincide with one of these can save on interest rates.

Having more than $500,000 with one bank also increases your negotiating power for a better rate. The more loans you have with one lender, and the fewer the splits, the more negotiating power you have. We will gladly facilitate these negotiations to get the best rate for our clients.