We had a great afternoon earlier this week, talking all things finance with local mortgage guru Lynda Sainsbury from LS Finance Broking based in Wonthaggi. If you currently have a mortgage, are thinking of getting a mortgage or refinancing, don't do anything without speaking to Lynda and her team first. She has a wealth of knowledge and is a breath of fresh air in an otherwise stuffy industry.
How long have you been open in Wonthaggi?
We moved into our current Wonthaggi premises in January this year. The lease agreement was signed just before Christmas, and then we had a little bit of renovating to do before we could get the doors open to the public. Prior to opening,we've been mainly mobile, so when a client contacted us and needed an appointment we would visit them in their home, or their office, or we'd agree to meet in a café.
How have you found the property market through the first quarter of the year?
Definitely more busy than what it was this time last year. Last year I took part of December off, just to have some time off with family, and business didn't pick up until the middle of February. The first six weeks of last year I was sitting around wondering where my next client was going to come from. Then around mid February, someone turned the tap back on and I was just inundated for the next three to six months after that. I was expecting that for this year as well so thought, "That will be nice, opened the door in January and I'll just ease myself into it." But the second that I moved in here, even though I had no advertising on the window or the facades, people seemed to know that I was here. I've just been busy from the word go which has been fantastic.
Where are your clients coming from?
I cover all of the Bass Coast and do have clients that have come across from my old banking days that are seeing me advertise because their parents still live around here but they're based in Melbourne or other side of Melbourne. They've been in contact with me for refinance and stuff, which is brilliant and it's great to of been able to help them.
How is the local property market performing compared to Melbourne?
I think the local market in the Bass Coast is a very different market to Melbourne. Anything that happens in Melbourne can sometimes take a year or two to filter down to us here. In my experience it's a completely different market. I think the local market is still quite strong in regards of how close we are to Melbourne. There are a lot of people starting to look this way, and are happy to commute every day. I've actually got a few clients who do that daily commute. First time buyers are still there, along with people retiring, moving out of Melbourne to do the sea change. We've always had that market and it's been really strong for the last two years.
Are you seeing a tightening of lending criteria from the banks?
It is tougher to get financed now in comparison to two years ago. Certainly in comparison to five years ago. There are different rules. Monthly living expenses are probably one of the major things we've seen come into play over the last few years. When it was first introduced we had to come up with a figure with the clients of how much they spend each month, now the banks really drill down onto this information and are really all over that figure. In most cases they will want to verify the figure with reconciled bank statements and don't take the information on face value. They will look at all of your bill amounts, cash withdrawals down to how much you are spending at Coles on the weekly shop. There's not a lot you can hide these days and questions are asked that have not been asked in the past.
Why should people work with a Mortgage Broker?
The main reason is because I can see what all the other banks are doing. I can see what their policies are, and they are all different. So while one client might be a great fit with their circumstances, they totally won't fit with another. So the benefit is that I've got the knowledge and experience to hopefully get a great result for the client first time by placing them with a bank where they are going to have a good experience and get the approval they need first time, saving them time, aggravation and not to mention stress!
So if someone was self employed, like a tradie they might be a better fit with a particular bank?
Yes. Some banks still like two years of trading history, other banks will just take the most current year. So from a servicing point of view that's a massive difference. Especially if they've had the most current year as a much stronger financial year than the previous year. So knowing that and knowing which banks have which policy, I'm definitely at an advantage over a client trying to do it themselves at their local bank branch who have to try and make the criteria fit with their own policies for approval.
If someone's never been to a mortgage broker before - what's the process?
First of all, they would have a conversation with me on the phone for anywhere from ten to twenty minutes. I would find out exactly what they're looking for and make sure I can help them. I don't want to waste their time. Then, we would set up an appointment to meet face to face. I've got certain compliance regulations that I have to meet, so I send them out an email and collect some personal information, that will save time during the appointment process.
What documentation should people bring to a meeting?
So, for my information that I need to submit to the banks it's mainly three things. Identification, copies of your bank statements from the last three months, and everything to do with your income. So, other than that, the bank statements will provide, hopefully, the deposit. If they haven't got the deposit but they've got Mom and Dad willing to go down as guarantors for them, then they don't even need any money in the bank. Mom and Dad will hopefully provide the security required. So that's it. It's fairly simplistic in the process. It can get complicated, further down the track (depending on the scenario). No two applications are identical to each other. So that's where I have to use my knowledge and work out which banks products and policies best suit the customers' objectives. Especially if it's a tricky application or something slightly outside the square. Because a lot of people would come to a broker if they just initially thought that their loan wouldn't be accepted by the big four bank in town.
There is one other thing brokers bring to the customer and the market, and that's choice! This, in turn, keeps the banks honest and ensures better competition in the market which helps provide better product offerings as the lenders are forced to compete rather than sit back and monopolize the market.
So for anyone looking for a mortgage or to refinance, what's the best way to reach out to you?
However works best for them - pick up the phone, send us an email or pop into our Wonthaggi office for a coffee and a chat.
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