Helping hand: finding the right solution to save a property purchase

February 25, 2020

At Distinctive Finance, we understand everyone’s financial situation is unique – and we treat every one of our clients as individuals. We were delighted to help Sydney-based Chris recently after his regular bank kept moving the goalposts on a home loan.

It was a deep frustration with his regular bank that prompted Sydney-based Chris to contact the team at Distinctive Finance.

“I’ve been living in the inner-West of Sydney for around 25 years,” explains Chris.”

I have an investment property in Summer Hill and had a mortgage on that property through one of the ‘second-tier ‘banks.

“At the time I was living in rental accommodation and was looking to buy a place. I found a property I liked in Putney. It was going to auction. I called the bank I had the mortgage on my investment property with to see if they could help me. They’d always seemed pretty good.”

Home loan pre-approval… proceed with caution

After a phone call and application process – albeit blighted by a few bank admin errors – a home loan of around $450,000 was pre-approved. All seemed to be going well until, a week later, Chris received another call.

“They told me they had made a mistake, and they couldn’t lend me as much as they’d initially told me they could.

“It was frustrating, but the amount they were offering was probably still enough to purchase the property, so I was OK with that.”

Some other conditions didn’t sit as comfortably, though.

“They told me I’d have to substantially reduce the limit on my existing credit card or alternatively get rid of it altogether and replace it with one of theirs”.”They were also querying my insurances – it turned out, they were trying to get me to sign up for their insurances, too.”

However, Chris went ahead to auction and agreed to purchase the property within the adjusted pre-approval limit the bank had offered.

Now, when you purchase at auction, there’s no cooling-off period. Chris was committed to buying the property.

From pre-approval to approval

After agreeing to purchase the property based on the pre-approval amount, Chris called the bank to let them know it was going ahead.

He was in for a rather unpleasant surprise.

“I hadn’t been able to reduce my credit card to where they wanted it, and they told me they had to do a recalculation and would need to reduce the amount of the mortgage on offer again. This time by a further $50,000.

“I was furious. I’d committed to spending almost a million dollars on their say-so, and now they were telling me they were offering to lend me less again.

“There was no way I was going to sign their loan contract. But I needed to find a solution, and quickly.”

How the personal touch can help find the right home loan

As Chris’s frustrations mounted, his partner mentioned her boss had used Leighton Packer at Distinctive Finance to help sort out some more complex finance. Chris made a call.

“It was a world of difference,” Chris said.

“He was really knowledgeable and helped me calm down because as you can imagine, I was incredibly wound up by the whole situation”.

“He asked me to get together the information he’d need to find a solution and started to explore options.

“A couple of days later, he actually came to my house to talk me through the different avenues that were available to me. He had four or five potential solutions.

“Within ten days of him coming around, I had approval – not pre-approval – on the finance I needed to complete the deal.

“When we made the offer at auction, we’d gone for a 10-week settlement period, rather than six weeks, which bought us more time. But, as it turned out, Leighton had worked so efficiently that we would have even made it for a six-week settlement, despite the setbacks of the other bank”.

Overall, Chris says, that he felt significantly more comfortable dealing with one person, sometimes face-to-face, who understood what he needed, and could ease some of the burden.

“I’m a 54-year-old who’s purchased property before, who’s been married, had kids, raised families.

“The way the bank spoke to me was as if I was an idiot. There was an arrogance there – they spoke to me as if I had no idea what I was talking about.

As soon as I spoke to Leighton, it was the complete opposite.

There were some issues to sort out with the deal that Leighton had arranged, and he took care of it all – spoke with my solicitor, picked me up to take me to sign the papers, everything.

I consider myself very fortunate that I was given his number. I’ve since taken my investment property to him, and we’re looking at another investment together now.

I’ve also recommended him to some friends, and I will be working with Leighton for a long time to come”.

With more and more financial arrangements taking place primarily online and over the phone, and applicants often being assessed by an algorithm, the personal touch can be lacking when dealing directly with financial institutions.

As Chris’s situation goes to show, the personal touch can make all of the difference.

Leighton Packer headshot

More About Leighton

With over 10 years of experience in finance as a Private Banker, Branch Manager, Business Development Manager and Mobile Banker, Leighton brings knowledge, big picture thinking and tenacity to Distinctive Finance clients.

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