| What are Non Bank and Non-Conforming lenders. |
Non Bank lenders provide an extensive range of bank beating rates as well as some loan products me meet specialist needs. Some non bank lenders are multi national with resources in excess of any Australian bank.
Non Conforming lenders are lenders who provide specialised loan solutions to meet the needs of their clients. Typical non conforming loan products include Lo Doc, loans for people with credit issues or unique securities. A non conforming loan solution needs to be seen as a "interim solution" until the borrower can return to a more mainstream lender. |
| LVR |
Loan to Value Ratio, often referred to as LVR, is an important calculation to keep in perspective when purchasing property with finance.
The Loan amount as a % of the property value. For example, a $100,000 loan secured by a $200,000 property would be a 50% LVR. $350,000 security with a $200,000 loan would be 57% LVR.
The easiest way to calculate loan to value ratio is to divide the loan amount by the actual property purchase price or valuation.
An $80,000 loan ÷ $100,000 purchase valuation = 0.80
Multiply this 0.80 x 100 to convert to a percentage and the loan to value ratio = 80% LVR |
| Predominate Use |
How are the majority of the loan funds being used?
Unless the borrower is a company buying a residential property even for investment is personal use. Any loan in a natural person's name that is used predominately for or on residential property is regarded as Personal Use under the National Consumer Credit Protection Act NCCP. See below NCCP - What is an Unregulated Loan? |
| Describe your credit history |
Information recorded about you with a credit reporting agency such as Veda.
This could be late payments, credit defaults or court judgements. Judgements and payment default listings remain for 5 years after they are paid. You can obtain a copy of your own report. Click here. |
| Do you require cash out |
Are you seeking cash above any amount for purchase or refinance of property or loan accounts including credit cards. This is money that would normally be paid into your personal bank account. This could be for personal use, working capital even an ATO bill.
Some funders treat partial payments of Credit card debt as being Cash Out. Full payout of the debt and cancellation of the card is NOT treated as Cahs Out. |
| Population |
The population in the immediate area of your security property. This is a key factor in obtaining an approval. The population criteria can vary from lender to lender. This website breaks populations into 2 general areas less or more than 10,000. |
| NCCP - What is an Unregulated Loan? |
Since the inception of NCCP there has been a distinct change in what is considered code and non code (the terminology of regulated and unregulated went out when NCCP came in).
Whilst identifying a code loan is still reliant on the purpose, if the credit is provided or intended to be provided wholly or predominantly:
- for personal, domestic or household purposes; or
- to purchase, renovate or improve residential property for investment purposes; or
- to refinance credit that has been provided wholly or predominantly to purchase, renovate or improve resdiential property for investment purposes.
then the loan will be considered to be a code loan. |
| Features |
| Line of Credit |
A Line of Credit is an approved loan amount that is above the borrowers actual mortgage debt. This allows the to use the extra funds as they need to, usually by way of an access or credit card. For example the mortgage might be $350,000 but the approved loan amount is say $400,000, this would mean the borrower has access to the additional $50,000. |
| Capitalise LMI/Risk Fee |
LMI is Loan Mortgage Insurance. This is a fee charged by the lender to insure your loan against default by you. Many of the loan products used by this site site don't have LMI. Where LMI is applicable, the LMI insurer can and often do over ride the approval given by the lender. Click her for more information. |
| No Geniune Savings |
Some funder will consider an application from someone without genuine savings. The funder will consider how the borrower is sourcing the balance of the loan and may consider:-
• A gift from a family member (we have gift letter templates available)
• First Home Owners Grant (FHOG)
• Advances on wages/commission from an employer
• Inheritance
• Financing of a deposit
• Builder discount/finance
• Vendor discount/finance
• Proceeds from sale of motor vehicles
• Windfall gains
• One-off government payments (e.g. tax refund)
• Sale of shares if they have been owned more than 6 months. |
| Fixed rate Option |
Some lenders allow you to fix your interest rate for a set period, usually up to 5 years. |
| Off Set Account |
A mortgage offset account is simply a savings account linked to your loan account. Unlike an all-in-one loan that combines your credit card with your transaction accounts, an offset account works like a regular savings account. The big difference is that the balance in the savings account is offset against that owing on the mortgage. Any 'notional' interest on savings is earned at the same rate as the linked loan. |
| Pro Pack Option |
Loans with "Pro Pack" options usually have a lower annual interest rate however they will usually have an annual fee as well. |
| No annual fees |
Most non bank / Non conforming loans don't have annual fees. An annual fee may not be a bad thing. Weigh up the costs and benefits offered by loan with an |
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