Getting tough deals across the line

by Adam Smith12 Jan 2016


Due to the outstanding ATO debt and unpaid defaults, the applicants were unable to obtain LMI and their loan application was declined by a major bank.

The solution:
We were able to refinance the applicants’ owner occupied residential property to 80% of the valuation amount under our PRIME risk grade, giving a loan amount of $460,000.  

From this, we repaid their existing mortgage ($340,000); unpaid defaults ($26,000) and ATO debt ($25,000); leaving equity release of $69,000 for business expansion.

In addition, the clients owned the commercial property from which they operated their business.  The clients estimated that the property was worth $800,000 and they owed $420,000 against it.

We were able to refinance their existing commercial mortgage accessing additional equity by approving a loan of $560,000, giving them additional cash of circa $140,000.

The overall result being that we achieved the applicants’ objective of accessing $200,000 for business injection and cleared their outstanding debts in the process.  

All loans were approved using our Lite-Doc products.

The takeaway:
Specialist Lenders are a great alternative for brokers and their clients when the major banks and LMIs are unwilling to assist. La Trobe Financial is able to provide specialist lending solutions across its broad product range, which includes Residential, Commercial, SMSF, Development Finance and Non-resident loans. These products are available on a Full-Doc or Lite-Doc basis, and can cater for credit impairment where it has occurred as a result of an unforseen life event. Having specialist options across multiple asset classes allows brokers to structure better solutions for their clients. The scenario above resulted in the broker refinancing two mortgages from a major bank earning full commissions on both – from day 1 with no clawback applicable. We were able to turn around a possible cancellation to a profitable restructure, a win-win for the clients and broker.

 

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