Can your profession gets you a better deal on your home loan?

The answer to the above mention question is YES, it can. When it comes to saving on your mortgage, some of you may not have to look further than your job. If yours is a profession that classifies you as a ‘low risk’ borrower in the eyes of lenders, then you may be entitled to special discounts.

The lucky ones

Accountants, lawyers and teachers are commonly eligible for home loan discounts, or particular loan types without fees, based on their professions. The benefits differ depending on specific professions. It depends on what industry the lenders decide to target as it’s a constantly changing situation, so what’s here today may not be around tomorrow.

An example of this is the slowing down of the mining industry in 2015, which saw mining engineers lose their ‘in demand’ status and their profession-based discounts.

Doctors take the cake

Lenders have their own target lists of professions, but doctors are the big winners. They’ll get waived LMI, lower interest rates and, in many cases, banks will even go outside of their normal policy to get their loans approved. However, not all medical professionals, such as psychiatrists, chiropractors, vets and pharmacists, are accepted by all lenders so it’s always advisable to confirm.

How the perks work

Simply being in a certain profession won’t automatically save you on your home loan. To qualify you must apply with a lender that offers your profession a special discount and meet that lender’s criteria. You’ll often need to provide evidence of membership of a certain industry body such as the Australian Medical Association. Waived LMI is usually approved without any problems if you meet the criteria, however your mortgage broker may need to negotiate to get a better interest rate as well.

Because lenders don’t publish these better interest rates, to benefit from the discounts it’s best to have your broker by your side. Not only will they know which lenders to apply to, they will also assist you with pricing requests and negotiating the best possible interest rate.

MFAA accredited finance brokers are industry leaders who have the knowledge and expertise to find the most appropriate loans for even the most complex financial scenarios, including profession-based discounts.

RBA CASH RATE UNCHANGED

The Reserve Bank of Australia (RBA) has decided to keep the cash rate at 1.5 per cent for the 25th consecutive month of RBA announcements

MORE TIGHTENING TO INTEREST ONLY LOAN

Earlier this year, the regulator announced new curbs to interest-only lending. Regulator’s focus on tightening of credit regulations on interest-only loans is a welcome change as it has encouraged more responsible lending by banks and other institutions to not place customers under undue stress and thus end up paying more on their home loans, particularly if their loan is an owner-occupied loan.

HOW TO NEGOTIATE IN A SOFTER HOUSING MARKET

Whatever the state of the market, every negotiation is based on the same premise – vendors want to receive the highest possible price while buyers want to pay as little as possible. Both, however, need to give careful thought to how they approach a negotiation when the market is in decline.

TIPS FOR VENDOR’S :

Be realistic ,Take offers seriously AND Be ready to act.

TIPS FOR BUYER’S :

Do your research – be clear about a realistic market price.

Let the agent know if you’re interested in a property

Call now on 1300 30 6767 or enquire through the form.