90% with (almost) no LMI for everyone!!!

perthguy said:

I am not sure if I like the sound of that. I am just refinancing all my loans to them It could get interesting I guess. I am pretty sure I can get out of it though

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I presumed you refinanced at 80% + most likely for their low fixed rate...
The issue with ING is poor cash out policy above 80% + most importantly their serviceability is one of the worst ; so even if you have equity you might not be able to take anything out ( Serviceability becomes a problem with ING esp if you have more than 2 loans- as they all need to service on 8% and p/i) - BUT if you dont need or have no plans on using equity from that property for 1-2 years period etc than it's fine in some cases- the key is plan ahead.

TO be honest nothing "wrong" with ING as such..as i said they have their place depending on your needs and timming ( now, short term and long term over a 1-3,5 years period) + your financial capacity ( ie deposit/ savings LVR).

We use on average 17-20 different banks on a regular basis every quarter; and yes ING is probably not our top 5 in terms of volume but they do come in handy esp for first home buyers ( high LVR) and ppl who are rate sensitive and not after anymore purchase for a while or after a fixed rate with no equity ( esp 80% LVR loans)

P.s ING cash out policy has changed around 12 month ago for loans under 85% lVR...not the best but workable now...

+ they have the 80% No val policy- not a market leader or anything fancy, but every policy change is an improvement

+ upfront val.

perthguy said:

I am not sure if I like the sound of that. I am just refinancing all my loans to them It could get interesting I guess. I am pretty sure I can get out of it though

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It just means that if you want to access your equity in the future, you may have to refinance again. You need to consider that this may cost time, money and opportunity if you're not prepared.

There's quite a few good things to say about ING. They're consistently competitive, they try to do the right thing by their customers and they've had very good fixed rates for quite some time now. They do have their place. Their problem is they have a number of policies which simply don't accommodate property investors very well.

We all use lenders that we gravitate to; for what is worth, I use ING and have had no issues with cash out, have used ING for investors.

However it?s important to get the sequence right, as indicated the assessment rate for ING is high and so ING first, followed by other lenders for the next deal and so on.

I have had deals where we went to ING first and then another lender for the second deal, had we revered it i.e. ING first, the deal would not have worked.

I thought ING was one of the best for commercial loans and has no annual reviews?

Tano said:

I thought ING was one of the best for commercial loans and has no annual reviews?

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Commercial policy is very very different to residential policy/servicing - something to note with all lenders.

We don't do a lot of commercial but when we do the commercial space is not the same as resi, with resi you might have 10 lenders that will fit but with commercial sometimes only one or two.

Other brokers who do a lot of commercial may have something more to add.

Tano said:

I thought ING was one of the best for commercial loans and has no annual reviews?

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We're not talking about commercial loans. The offer is a massive LMI waiver and commercial loans are not mortgage insured.

ING do have an excellent commercial product. Again their servicing and policy model is very conservative, but the fees, charges, rates, LVRs and terms are quite generous. They won't suit everyone or every deal, but like most things, they do have a niche.

Mick C said:

I presumed you refinanced at 80% + most likely for their low fixed rate...

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No... and no. Phew! That's a good start! 71% LVR and the variable rate.

Mick C said:

The issue with ING is poor cash out policy above 80% + most importantly their serviceability is one of the worst ; so even if you have equity you might not be able to take anything out ( Serviceability becomes a problem with ING esp if you have more than 2 loans- as they all need to service on 8% and p/i) - BUT if you dont need or have no plans on using equity from that property for 1-2 years period etc than it's fine in some cases- the key is plan ahead.

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Cheers mate. I apprecite your comments. That's ok, because I am not purchasing in the near term. I just switching to a building phase and have that covered. The way my development plan is shaping up, we might test some of INGs policies. That's where I will put my mortgage broker to work!

perthguy said:

No... and no. Phew! That's a good start! 71% LVR and the variable rate.

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EVen better

Peter_Tersteeg said:

It just means that if you want to access your equity in the future, you may have to refinance again. You need to consider that this may cost time, money and opportunity if you're not prepared.

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Cheers Peter. I don't need to access any equity per se. Although, I might see how "portable" their "portable" loans are

Evachange said:

However it?s important to get the sequence right, as indicated the assessment rate for ING is high and so ING first, followed by other lenders for the next deal and so on.

I have had deals where we went to ING first and then another lender for the second deal, had we revered it i.e. ING first, the deal would not have worked.

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Thanks. That's really useful to know. In that case I am glad that I went ING first. There is a possiblity down the track of moving one property to another lender at the same time as a purchase/development and leave the rest with ING. It sounds like that might work out ok but will need to evaluate at the time.

Thanks to all for taking the time to respond. It's always good to know in advance any issues that might arise in the future so I can develop an appropriate strategy to resolve.

Peter_Tersteeg said:

Just got a very interesting flyer from ING. I'd heard that they were making some changes to their LMI policies, but I didn't see this coming:



Keep in mind that ING isn't exactly a preferred lender for investors, this is for owner occupied property only and the loans must be principal & interest. Their serviceability model (for investors) is terrible, their cash out policy is a nightmare, etc, etc, etc.

For the first home buyer or a refinancer who doesn't intend to leverage their home later, this looks pretty sweat though...

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Refinancing is not eligible. I see a niche for upgraders though. A lot of FHBs (that I see anyway) dont have the 15% or so required for an 88% lend.

tobe said:

Refinancing is not eligible. I see a niche for upgraders though. A lot of FHBs (that I see anyway) dont have the 15% or so required for an 88% lend.

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I'm quite happy with this, as the FHBers I do see generally have the funds to get a 90% LVR, and at ~600-650k purchases this can save them up to 13k.

In the end, just another arrow in the quiver.

One little word (purchase) changes the meaning a fair bit. Easy to miss.

Like CJay, I don't see this as a big deal. Getting a 90% refinance through ING is not exactly simple.

What is the average first home buyer loan? I would have thought around the 400k mark? If so then very roughly does this translates to a 6k saving on 90% or 4k on 88%?

albanga said:

What is the average first home buyer loan? I would have thought around the 400k mark? If so then very roughly does this translates to a 6k saving on 90% or 4k on 88%?

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Yeah thats about right - it would largely depend on the location. In the ACT i assume it'd be closer to the 300k mark, whereas in Sydney it'd probably be up near 500k.

Cheers,
Redom

albanga said:

What is the average first home buyer loan? I would have thought around the 400k mark? If so then very roughly does this translates to a 6k saving on 90% or 4k on 88%?

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Nobody knows. The reserve bank cant even estimate the proportion of investors v O/O loans. In vocitoria they could ask the SRO how many FHB discount forms they are receiving, but this only relates to purchases below $600,000. not sure how it might be collated elsewhere.

Across my desk its about $350k, but each area will be diferent. Some areas wont have many FHB's at all.

Thanks Redom and Tobe
Given the mostly negative feedback regarding ING from previous posts and the fact this is only for OO which is mostly going to benefit FHB on smaller loans would you really be inclined to recommend this to clients based on a saving of say 5k?

If that is capitalised over a 30 year loan then the amount is going to be almost insignificant (Roughly $5 a week)?

most FHB I see come to me asking for how much they can borrow, and then how much deposit they need.

Then they come back after doing the rest of their saving/hitting up Mum and Dad, selling something etc.

Less than 10% of the FHB I see have more than the minimum deposit, and thats usually because they arent actually FHB, they are migrants who sold up when they left for Australia.

I already do a fair bit of FHB without LMI, through parental guarantees.

Like I said, I think the space for this product is upgraders. The sale proceeds on the old place was a 20% deposit on x, now it can be a 10% deposit on x by 1.5 or more.

Average FHB I see is circa $600K - $800K loan. Usually bigger loans than my investor clients (per property at least).