Getting the best mortgage is no-longer a one-size-fits-all issue – and if Australians want a loan, they need to understand what banks are looking for in a mortgage applicant.
Every lender is looking for different things in an ideal borrower and, as a result, some lenders are offering really sharp deals for their target market. If you have lots of savings some lenders will offer you 2.99 per cent interest rate. If your age is 25+ then you are in Virgin’s target market.
One of the first thing a bank will do when they receive a mortgage application is run a credit check. Here an entire can of worms can come into the open for some applicants – having a huge impact on whether or not you can get a loan and the interest rate you will pay.
Recent research shows that having bad housemates could cost Australians almost $180,000 in later life or $7,104 a year.
If a flatmate misses paying bills or rent on time, it can hurt the others’ credit ratings.
And these changes are only going to become more significant. Historically, all a credit check did was look for black marks on your repayment history. But now, it is also identifying those who make repayments regularly and early – these borrowers are the ones who are rewarded with low home loan rates.
But lenders attach different weight to credit history. For some banks, a few black marks are a show-stopper, while others can ignore the occasional oversight.
If you want to know which lender is right for your own personal circumstances, please contact your Origin broker.
Graeme Salt is a leader of The Futurus Group whose brands primarily comprise Origin Finance, Chan & Naylor Finance as well as Walker & Miller Training. For a no-obligations consultation on your home loan needs, please contact him on 1300 30 67 67.