As mentioned earlier here’s Marks first comments, the first installment of regular comments from NZ’s 2008 No. 3♣ Mortgage Broker.
In this last quarter of 2008 NZ property owners have billions worth of fixed home loans up for renewal. In late 2004 our banks aggressively discounted to generate 2 year fixed loans customers. As a consequence many property owners renewed their 2 year loan for a further 2 years in late 2006.
One of my clients faced a fee of “over $15,000 and closer to $20,000” for breaking their fixed-term mortgage.
Another of my clients was able to get the full 100 percent mortgage by borrowing 80 percent from one bank and 20 percent from another. There are still 100 percent lenders out there. Even so, people have still got to show they can service the loan.
I had an example recently of two teenagers who were buying a property. Mum & Dad had gifted them enough for a deposit. Their application was declined by their own family bank but accepted by another one, through me.
With the current financial turmoil happening around the world, many banks have taken an axe to their lending manuals and policy.
I’m often asked “What does this mean for the client?” – it means one word, Problems.
A recent example illustrates this;
Client A goes to their own family bank to request a $20k top up. Their family bank declines this request due to this new more stringent current lending policy. However by using an Accredited Mortgage Broker (NZMBA Approved) this very loan could be sourced from another lender.
Every person is different and each has their own individual circumstances and needs.
Its because of this that each person requires a tailored approach to have their respective loans approved.
Regards, Mark Papps
♣ NZMBA – Nelson Marlborough Mortgage Broker of the Year 2006, 2008
♣ NZMBA – New Zealand Mortgage Broker of the Year – 3rd for 2008
Mark Papps is the Manager of Nelson Marlborough Mortgage Services. He specialises in Home Loans.