When it comes to saving on your mortgage, some of you may not have to look further than your job. If yours is a profession that classifies you as a ‘low risk’ borrower in the eyes of lenders, then you may be entitled to special discounts.
The lucky ones
Accountants and lawyers are commonly eligible for home loan discounts, or particular loan types without fees, based on their professions. The benefits differ depending on specific professions. It depends on what industry the lenders decide to target as it’s a constantly changing situation, so what’s here today may not be around tomorrow. Accountants and lawyers can also get their Loan Mortgage Insurance waived. (Terms and conditions apply)
Doctors and medical professionals take the cake and eat it!
Lenders have their own target lists of professions but doctors, veterinarians, optometrists, dentists, psychiatrists, physiotherapists, pharmacists, chiropractors and other medical professionals are the big winners. They’ll get waived Loan Mortgage Insurance, lower interest rates and, in some cases, banks will even go outside of their normal policy to get their loans approved. However, not all medical professionals are accepted by all lenders so it’s always advisable to talk to your broker who can confirm with the lenders.
How the perks work
Simply being in a certain profession won’t automatically save you on your home loan. To qualify you must apply with a lender that offers your profession a special discount and meet that lender’s criteria. You’ll often need to provide evidence of membership of a certain industry body such as the Australian Medical Association. Waived LMI is usually approved without any problems if you meet the criteria; however, your mortgage broker may need to negotiate to get you a better interest rate.
Because lenders don’t publish these better interest rates, to benefit from the discounts it’s best to have your broker by your side. Not only will they know which lenders to apply to, they will also assist you with pricing requests and negotiating the best possible interest rate.
I recently helped an accountant borrow $418,453 (89.99% of the valuation) to purchase a home worth $465,000 saving him approximately $9,913 in Loan Mortgage Insurance.
He was under the impression that he couldn’t get the First Home Owner Grant of $20,000, as he owned an investment property. Lucky for him, I knew that under certain circumstances you can own an investment property and still get the FHOG.
One client was extremely happy when we refinanced his existing investment loan of $254,000 from 4.59% with a $395 annual fee to 4.19%pa with a new lender and borrowed an additional $24,969 (89.99% of the valuation) saving him on Loan Mortgage Insurance approximately $5,944. He will also save approximately $32,943 over 30 years by refinancing to a lower rate and only paying one annual fee for all his loans.
Loan Broker to the Aussie Battlers