Resi Renew / Restart Product Review
The Resi Renew/Restart product range can cater for nearly all loan scenarios.
Business we are seeing right now
1. Debt Consolidation - The refinance of multiple debts to one manageable payment continues to show strong enquiry. Near Prime allows for late payments on the home loan as well as unsecured debts like credit cards and personal loans - clients can refinance an "unlimited" amount of debts up to 90% Full Doc or 80% Alt Doc
2. ATO Debt - requests for ATO debt consolidation remains strong with clients having met with their accountant, completed their returns and now looking at placing their tax debt on arrangement. Recent feedback is that the ATO will no longer allow this to be paid back over long periods with most arrangements being 6-18 months. For a $100,000 tax debt, this places significant stress on the business cashflow which this is paid back - and at a 9% interest rate. The ATO also now has the power to report amounts outside of arrangement and > $10,000 to credit reporting agencies - We can consolidate these debts on Near Prime.
3. Company/Business Debt - Still getting a strong enquiry for consolidation of business debts. Most of these enquiries have the commercial loan (BTL or CRL) coming off interest only and the remaining P&I term is 5-10 years. These leave the borrower with large monthly P&I payments again causing cash flow issues on the business. We can consolidate these debts on Near Prime
Resi can help with the above by offering the following product niches with our Renew / Restart product range.
- Alt Doc + Accountant Letter or BAS or BBS
- 6 months ABN Registration
- Vacant Land Purchase
- ATO debt
- Late payments
- Discharged bankrupts 1 day
- Defaults listed >24months ago
- Unlimited debt consolidation
- Business loans/cash out
- Unlimited cash out
- FTB and CSA (any aged kids)
- Favourable purchases
- PAYG 1 day in role INC probation
- Workers Compensation
- Non Genuine Savings
- No Notional Rent
- VISA's - 309, 457, 475, 487, 820, 100, 119, 120, 121,
126, 134, 175, 176, 801, 855, 856, 857, 885, 886, 887
- 24hr SLA
- Servicing Calculator - OFI repayments at actual payment + 25%
- No credit scoring
- No Risk fees on most LVR bands
- Direct access to credit manager
- 95% LVR purchases / 90% refinance (full doc)
- 85% LVR purchases / 80% refinance (alt doc)
Capacity Tests - The biggest reason we get declines for debt consolidation is due to clients not meeting out the capacity test. How do these work? Pretty simple...
1. While we accept clients with late payments or in arrears we need to ensure that the clients can meet the ongoing monthly commitments once we refinance them
2. Our credit managers will do up a simple spreadsheet (similar to the one below) listing down ALL debts and what the client has paid on these debts - evidenced over the last 3 months
3. On the below example the client is looking to get a new loan for $500,000 with payments of $2,836 per month - we need to show the clients have AT LEAST been paying $2,836 per month across all their current debts. As you can see below the clients paid $3,270, $2,910 & $3,630 - each month they paid more than the new proposed payment which would be a pass
4. If the client had a month where they didn't pay $2,836 then this would fail capacity and the loan would be declined
The below is a capacity test that Resi gives to brokers that are looking to submit a debt consolidation loan - Not only does this pre-qualify the client BUT is also looks very good in credits eyes when these are sent in with the application!
For further information or to discuss a scenario please contact the Resi scenarios team on 1800 737 448 or email firstname.lastname@example.org