Better Mortgage Management (BMM) has opted to extend its risk fee special for Alt Doc/Lo Doc loans for another month, following numerous requests from brokers.
Introduced two months ago, BMM says the offering has already saved many self-employed borrowers thousands of dollars with a risk fee of 0.5%, making it the ‘cheapest risk fee or mortgage insurance premium in the market for unlimited cash out Alt Doc’.
Coupled with a rate of 6.74% at 80% LVR, BMM claims accessing finance with unlimited cash out has become much more affordable for self-employed borrowers in recent months amid an increase in Alt Doc lending.
The non-bank lender’s managing director, Murray Cowan, says it was no surprise brokers welcomed the low risk fee as it potentially saves borrowers thousands of dollars and removes a possible barrier to writing the application.
“Risk fees or mortgage insurance (where available) on comparable loans is 1.5% to 2.5% of the loan amount, so when we reduce the risk fee to this extent it substantially improves the affordability of the loan” says Cowan.
“For instance, on a loan of $500,000 with the previous risk fee of 1.8%, the saving will be $6500 with the new fee of $2500 compared to $9000 previously.”
With the risk fee special unlikely to be extended again, Cowan says now is an opportune time for brokers to review their databases for self-employed borrowers who will benefit before the offer, which ends on October 31.
“Borrowers looking to borrow on an Alt Doc basis to access cash out for business purpose, pay out ATO debt, debt consolidation, purchases or with less than two-year ABN term, are…suited to this loan”, says Cowan.