When applying for a mortgage in Australia

If you choose the wrong Australian loan bank, your loan will already be lost at the starting line! In this issue I will tell you the secret of choosing a bank.

Faced with the various refinancing subsidy promotions and widely varying interest rate discounts offered by major banks, readers and friends often ask me: 

• “How to choose a target bank when taking a loan?”

• "Whether the interest rate is low or not, I will focus on giving more money."

• "What's your broker's secret for helping customers choose banks?  "

Key factors for choosing a bank

There are many factors for choosing a loan bank, and these factors are always changing, but they remain the same. The core "factor" must be suitable for the borrower's own conditions .

Here I will give a few examples:The client had a history of late repayments, and the case had to go to a bank that relied heavily on system assessment;The property purchased by the customer only has two weeks to be delivered, and the case has to be sent to a bank with slow processing speed;The client's income is temporary, and the source of income is relatively complicated. The case must be sent to a bank with more rookie assessors;When a customer buys a property in a remote area, the case must be sent to a small bank with low tolerance.The above behaviors are basically polar opposites.

Before choosing a bank, you must sort out your internal conditions in detail. Australian banks mainly assess the overall situation of borrowers through four aspects:Character Employment Liability Security

Therefore, applicants need to know where they are deficient, and then choose banks that do not pay much attention to their deficiencies as the main application banks. 

Three factors for choosing a bank

The first important point is to choose a bank with a high success rate in applying for a loan.

Lenders need to have a preliminary understanding of each bank's application features and the attributes of its products. As I said before, applicants have different situations, and banks have different attitudes towards this "difference".

For example:

• Some banks require self-employed individuals to provide one year of tax return, and some banks require two years;

• Some banks don’t like “part-time” jobs;

• Some banks have looser requirements in this regard;

Some banks can only lend 70% of the valuation in high-density areas, some can lend 80%, and so on.

The applicant's primary goal is to successfully obtain a loan, so it is important to choose a bank that is favorable to your situation. 

The second important point is to start comparing the interest rates between banks.

The floating interest part is a bit particular. In addition to checking the bank's standard floating interest rate, you also need to compare it with the lifetime discount you finally got.

Finally, pay attention to additional fees , such as annual fees, application fees, attorney fees, valuation fees, and some miscellaneous fees.

The third point, post-loan period services, is often overlooked by homebuyers.

Some customers choose smaller financial institutions for a few relatively cheap products, but when it comes to actual follow-up services, they are often very poor.

This usually refers to factors such as back-end customer service, branch convenience, and the extent of interest rate hikes followed when the central bank raises interest rates. 

For example, I encountered a customer whose application for a loan extension took nearly a month to be processed. However, such applications can be processed within a week at other banks, thus missing a good opportunity to buy a house.