When a major bank Lending Manager called the Mint Equity office to seek help for her client, we knew this was a do or die situation for the customer. The Lending Manager admitted she had made an error on the client’s application, which had resulted in a declined application. Whilst not normal practice, she knew she had to help the client and find an alternative solution for him, so she called experienced mortgage broker, Zac Peteh at Mint Equity to help.
First home buyer Dave Hoxten* had saved $90,000 over the last three years to use as a deposit for a new home on the Central Coast. After some searching and negotiating, he managed to find a three-bedroom villa in Bateau Bay that had been on the market for a while. He threw in a cheeky offer of $395,000, (almost $50,000 less than the asking price), and to his surprise, the vendor accepted it.
First attempt at home loan approval: Online mortgage comparison site
Dave now needed to secure a home loan, quickly. Being a first home buyer and inexperienced in the mortgage world, Dave searched the internet for a low interest rate and started the process with an online mortgage comparison site. After a week of submitting his online request, he realised the lack of response and inconsistent information was not going to result in a positive outcome.
Second attempt at home loan approval: Major bank branch
Disheartened by his online experience, Dave approached a branch of a major bank. He assumed that one of the big banks would have great rates and organise his home loan approval quickly – well that’s what the adverts on TV told him.
Things were progressing well with the bank, although there were delays. He had to seek an extension on his cooling off period, so he wouldn’t lose the property or his deposit. The Lending Manager at the branch was relatively experienced, but a small error on the application resulted in a decline.
The Lending Manager was horrified by her mistake, and knew once the bank had issued a decline, there was no way of changing the decision. She knew Dave needed a fast approval now, as the vendors were preparing to offer the property to the next buyer – she called mortgage broker, Zac Peteh at Mint Equity.
Third and final attempt at home loan approval: Mortgage broker Mint Equity
The call from the Lending Manager came through on Thursday afternoon asking for Mint Equity to help one of her clients. Zac immediately offered his assistance and within an hour, Dave was in the Mint Equity office with his paperwork, nutting out the finer details of his home loan preferences.
By 5pm that day, Zac had prepared a shortlist of lenders Dave could select from, which he knew would provide a fast turnaround given Dave’s risk of losing the property. By 7pm, the home loan application was ready for Dave to sign. It was important that the application was submitted that day, so it would register in the lender’s queue and be reviewed the following day.
The evening was filled with visiting Dave at his workplace to sign the application form and mitigating issues that had arisen due to Dave’s two previous home loan applications. By 10pm, the application and supporting documents was submitted to the second-tier lender Dave had selected. The interest rate secured was only 0.01% more expensive than the online mortgage option, but Zac managed to get the first year’s fees waived, which put Dave back in front.
The next day
At 8am the next day, the lender called Zac to discuss Dave’s application. Funnily enough, the only question the Credit Manager asked was why Dave had applied to two other lenders – which showed up on his credit report.
Zac explained Dave’s bad online and bank branch experiences, and the credit manager just laughed. “We hear that a lot. No problem, approved!”
Dave received the unconditional approval letter by 11am and paid his remaining deposit.
Dave moves into the villa on 23 December. His first Christmas in his own home.
Lessons learnt the hard way
- Cheap home loan interest rates on mortgage comparison sites often cost you more due to their lack of experience, knowledge and unresponsiveness.
- Direct to banks will only give you one product option and if that fails, you’ll have to start again with another lender or broker.
- An experienced mortgage broker can mitigate issues before they arise, and Mint Equity has access to over 40 lenders, so you’ll have choice and fast-track options.
- Mortgage broker services at Mint Equity are free to use. If only Dave had come to Mint Equity in the beginning, he could have saved a lot of time and stress.
* Client’s name has been changed to protect his privacy.