The goal: Looking to purchase his first home with non- genuine savings.
Age: 37 years old
Occupation: Self- Employed Gardener (GST not registered)
Assets: Vehicle $8k; tools $15k; gifted funds of $50K
Liabilities: Currently renting for $550pw; Credit Card limit $6k
Jeff has been self-employed as a gardener for more than 3 years.
He has no blemishes on his credit file and takes home approximately $64k which can be confirmed on his tax returns and notice of assessments over the last 2 years.
He has his tools for work and a vehicle and only other debt apart his existing rental commitment is a credit card with a limit of $6k.
Jeff does not have genuine savings he could use as a deposit, however, a gift of $50k will be provided to him by a family relative very shortly. Adam is looking to borrow $330k on a property valued at $380k.
As Jeff can supply most recent 2 years of tax returns, he may qualify for a prime mortgage with one of our specialist lender, even though he has no genuine savings.
This product is suitable because it goes up to 85% LVR(Loan to value) and allows non- genuine savings. Since turnover is < $75, GST registration is not required.
In addition, no LMI (Loan Mortgage Insurance) or equivalent fee is payable, which saves Jeff several thousand dollars.
Case Study 2: Meet Jenny…
The goal: Looking to purchase her first home with no savings.
Age: 24 years old
Occupation: Customer Service Advisor
Income: PAYG $42K
Assets: Car valued at 5K
Liabilities: Credit Card 3K
Jenny has been employed as a customer service advisor at the same company for 2 years. Before that she’s had various other jobs in a similar role.
She has no unfavorable entries on her credit file and earns about 42 k. Jenny can show tax returns for the last 2 years as well as current payslips
She owns and a vehicle and only other debt is a credit card with a limit of $3k.
Jenny lives with her parents. She does not have any savings she could use as a deposit, however, she would like to purchase her own apartment as soon as possible. The apartment is close to her work and the purchase price is $280K.Her parents are not in a position to gift or even lend her any money, however, Jenny does qualify for the First Home Owners Grant..
Jenny has a permanent, full-time job and can supply most recent 2 years of tax returns as well as recent payslips. She may qualify for a prime mortgage with a couple of our lenders, even thoughts he has no savings and no deposit.
Even though her parents are not in the position to give Jenny any financial help they have agreed to act as guarantors. This is possible as Jenny’s parents own a property valued at $450K and an outstanding mortgage of just $120K. This means they have approximately $330K of equity in their property which they can use to help their daughter get a loan from the bank. Jenny’s parents do not have to give Jenny nor the bank any money, the equity is just used as additional security. As soon as Jenny pays of enough of her mortgage to have over 20% of equity in her own property, she can remortgage and her parents guarantee ceases
In addition, no LMI (Loan Mortgage Insurance) or equivalent fee is payable, which saves Jenny several thousand dollars.
Case Study 3: Meet Lisa…
The goal: Casual Worker, looking to purchase her second home.
Age: 35 years old
Occupation: Registered Nurse
Income: PAYG $75K
Assets: Car valued at 15K, deposit from sale of property-$85K
Liabilities: Credit Card 5K
Lisa has been employed as a Registered Nurse for 3 years on a Casual basis. Before this she’s had a permanent position with a different hospital. She decided to work on a casual basis to allow time for travelling and also because she decided to go back to university part-time to complete a Masters in Nursing.
She has a clear credit file and earns about 75 k. Lisa is able to show tax returns for the last 3 years as well as current payslips
She owns and a car worth about $15K and has a credit card with a limit of $5k.
Lisa has sold her first property and is currently renting an apartment She $85 from the sale of her property and an additional 6K in savings, making a total of $91K she could use as a deposit ( minus stamp duty etc)
She is looking to purchase a house for $360K
Lisa has a casual job, however she can show 3 years of tax returns as well as recent payslips which show that her income is fairly stable and consistent So, even though Lisa is just on a casual contract, she may still qualify for a prime mortgage with a couple of our lenders. Nursing is also considered a stable profession by the banks.
Further, as Lisa has $91K in genuine savings, she could easily put down $72K(20%) as a deposit. A 20% deposit represents a home loan of 80% LVR (Loan to Value) and these are seen as much lower risk by the banks than loans with a lower deposit.
In addition, no LMI (Loan Mortgage Insurance) or equivalent fee is payable as the loan has an LVR of 80%. This will save Lisa the LMI fees which can be several thousand dollars.
Case Study 4: Meet Michelle…
The goal: Looking to consolidate $100k of business debts
Age: 57 years old
Occupation: Teacher for the last 7 years
Income: PAYG $78K
Assets: House valued at $750K
Liabilities: Bank loan $120K
Michelle’s husband passed away 1 year ago. She was a director and shareholder of his company but when her husband passed away the company ceased trading.
Recently, the company was placed into liquidation by a creditor and $120K in unsecured business debts is now being called upon which are secured against the family home.
Michelle is currently working full time in a PAYG role and would like a mortgage to refinance the business debts that need to be refinanced immediately.
Trish may qualify for a Full-Doc Product with a couple of our lenders.
In this case, it would be necessary to obtain documentation (e.g. Deed of Company Arrangement) from the liquidator confirming that after payment of the $120K business debts, the company will have satisfied all of its financial obligations.
The loan would be subject to standard underwriting criteria including selecting a loan term that is appropriate for Michelle’s retirement strategy.
Case Study 5: Meet Matt…
The goal : Business owner looking to access cash for business expansion
Age: 39 years old
Occupation: Company Director for the last 9 years
Income: Last 2 years taxable income is $78K & $135K respectively
Assets: House valued at $550K
Liabilities: Low doc loan $160K, business loan $70K (secured against the home)
Credit Impairment: Paid commercial default listed on CRAA for $58K registered just over 24 months ago
Matt needs $130K for the purchase of a second warehouse to expand his business, plus an additional $65K for another truck so he can put on an extra delivery driver.
Matt, does not have his most recent financials completed yet, but he thinks that his profit has increased substantially to $250K and this can be partly verified by his bank statements.
Matt may qualify for an Alt Doc ( alternative income verification loan product available through MasterFinance from a couple of our lenders.
MasterFinance and these lenders will consider consolidation of low doc and business debts on our alt doc products.
-With these loan products there is no limit on cash- out for acceptable purposes including purchasing property or vehicles.
Matt is able to choose from 3 different options when providing income documentation – 6 months’ business bank statements OR 6 months BAS OR his accountant can complete Lender’s accountant’s letter
Case Study 6: Meet John..
The Goal: He is looking to consolidate debts and has a history of credit defaults
Age: 31 years old
Occupation: PAYG Plumber
Income: Averaging $1,700 per week
Assets: $380K Home; $35K Ute; $15K Tools of Trade
Liabilities: :$140K Mortgage; $25K Car Loan; $10K Personal Loan; $20K Credit Card; $15K Credit Card; $8K Credit Card; $5K Store Card; 3K overdraft
Credit Impairment: $5K credit default registered 18 months ago (unpaid); $450Utilities default registered 2 months ago (unpaid)
John went through a divorce 18 months ago, he has taken over all marital debts and in addition he has accumulated a $20K personal loan which was used to pay legal fees when the property settlement was finalised.
Theo’s mortgage statements are up-to-date but you notice that the payments are often a week late and a few of the cards are also over their limit.
John may qualify for a Full Doc Loan Product a couple of our specialist lenders which allows for credit defaults and allows consolidation of many debts into the mortgage.
The lenders do not credit score and they also do not have a limit on the number of debts that can be consolidated.
Case Study 7: Meet Steve…
The Goal: He wants to buy a property but has an ABN registered for only 12 months.
Steve’s dad is a truck driver and he helped Steve set up his own business 12 months ago, training truck drivers. Steve has secured various contracts with different well known haulage companies.
His ABN has been registered for just 12 months and he has also been GST registered for 9months.
Steve tells you that he banks his earnings into his business account and also lodges quarterly BAS statements with help from his accountant.
Steve also recently came into an inheritance; he had already started saving for his own home but now with access to this inheritance he has sufficient funds to purchase. He would like to enter the property market as soon as possible.
Steve may qualify for an loan product specifically for the self employed which allows alternative proof of income.
MasterFinance’s lenders will consider up to 85% LVR for a property purchase.
Steve is able to choose from 3 different methods of verifying his income including 6 months business bank statements OR 6 months BAS OR Steve’s accountant may complete MasterFinance’s Accountant’s Letter.
Case Study 8: Meet Karen…
The Goal: Small business owner looking to increase her cash flow
Age: 34 years old
Occupation: Opened her own Bakery business 18 months ago
Income: 2012/13 taxable $25K & 2013/14 taxable $60K. Current profit level is expected to be $130K
Credit Impairment: 2 months current mortgage arrears & a telco default $1,500 from 2013
Karen used a business overdraft facility secured by her home to cover her business start-up costs. The business has grown fast and she now leases a delivery van and has acquired multiple credit cards.
6 months ago Karen’s mortgage went into arrears when her van was taken off the road after a motor accident resulting in a loss of income while she waited for the insurance claim to clear.
Karen is managing the minimum repayments on her debts but she has not been able to get back on top of her finances.
A debt consolidation would reduce her monthly commitment allowing her to focus on continuing to grow the business.
Karen may qualify for Specialist loan which allows both, alternative proof of income for the self-employed as her last year’s financials for 2014/15 with a profit of $130K aren’t completed yet and which also allows for credit defaults up to 2 months mortgage arrears
To verify her income, she can provide a declaration of financial position plus 6 months BAS OR 6 month’s business bank statements.