CHOOSING A LENDER


When you are buying a new home or refinancing your present one, it is wise to do some comparison shopping among lenders. A low interest rate isn't the only criterion by which to evaluate a loan. You should also consider the terms of the mortgage, what your closing costs will be and the reputation of the lender.
 
Real estate agents are a good source of information about loans and lenders, whether you are buying a home or just refinancing your present home. We routinely assist buyers when they need a bond in order to purchase a home. We know what loan packages are available and the qualifying requirements.
 
Banks are becoming more innovative and offer a variety of packages, such as special deals for first time buyers or preferential rates for graduates. Your bank, as much as you like them, might just be your worst option for a bond.
 
Especially in good economic times, banks become extremely competitive in attracting customers. Understand, that you are their livelihood – without borrowers, they close down. The customer is king and you need to flex that consumer muscle. We are slowly moving away from the big daddy approach of banks to a more realistic supplier/customer based relationship.
 
The companies with the lowest rates sometimes have very conservative underwriting guidelines, and may not be willing to make loans on certain types of property or to buyers who are marginally qualified. We can tell you which companies and loan officers will go the extra mile to provide excellent service to make sure that the transaction closes.
 
Additionally, the banks have had to come to terms with the fact that many customers have less than perfect credit history and have adopted a more flexible approach in this regard. Unless you are a truly bad credit risk in terms of past credit behaviour, one of the banks is going to want to say yes to your application.

Other issues which affect your bond application :
  • Funds at hand - Banks only have a limited amount of funding on hand or to which they have allocated to bond financing. This changes all the time an dthe bank with the most funds will be more willing to lend. Those with lesser funds at the time will allocate this to the best customers first
  • Bank Appetite for Lending -  This goes hand in hand with funds available but banks also decide from time to time whether they wish to get a larger segment of teh bind market or not. The higher their appetite the better your chances of betting a bond.
  • The Area or Suburb - No bank wants to be over exposed in a particular area and will therefore limit their percentage of the total bonds in any suburb. One might not really want to provide any more bonds in your chosen suburb while another is quite prepared to.
  • The Sectional Title Complex - As with suburbs, the bank will not overexpose itself in a particular complex. The reasoning is simple. Should something go horribly wrong with the complex and values drop, they will not carry the full loss in value themselves.
  • Market Segmentation - Banks are always assessing which market segments are highest risk and you might find yourself in a price group that the bank wishes to be more conservative in its lending. Additionally, there is ongoing political pressure to provide loans to lower/middle income groups and this could well be in your favour if you are in this category.

Read the article on Bond Originators to assist you in looking at the options



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