There are a number of myths floating around about non-bank lender, but it’s important to know most of them aren’t true.
Are you not sure about whether to go with a bank or non-bank lender? There are a number of myths floating around that may cause you to think twice about going with a non-bank lender, but it’s important to know most of them aren’t true.
Non-banks lenders are offering borrowers a competitive alternative to the major banks, but not everyone knows what a non-bank is or how they operate.
So what exactly is a non-bank and how do they differ from the big lenders?
Some borrowers assume that a non-bank lender is for those who cannot get a home loan with a bank. Non-bank lenders have a major focus on lending and don’t offer a full suite of deposit products to help fund their home loans. They typically source their loan funds from the open market where investors provide their funds in exchange for a return. Institutional investors like superannuation funds can be the investors that invest in these sort of investments.
Non-banks provide competition to the banks and give borrowers more choice in home loans to choose from. They are required to abide by the same consumer credit rules and regulations as other lenders so you can be assured that you have similar rights and expectations of service as a bank lender.
Myth: Non-banks are not competitive
Unlike the big banks, non-banks are not weighed down by the cost of having large corporate structure and branch networks. This allows them to be able to offer more competitive interest rates, flexible loan options and tailored communication with their borrowers. The interest rates on State Custodians’ most popular loans have consistently been below that of the major banks since we started in 2007.
Myth: Non-bank home loans don’t come with all the features I need
Non-banks often don’t offer full banking transaction accounts and credit cards as they are not licenced to offer deposit products (ADI’s) but features on their home loans can be similar to what you get with a bank. Features like internet access to your loan, offset accounts , debit MasterCard to access your funds via EFTPOS and ATM’s and free online redraw are all available with many non-banks including State Custodians.
Myth: Non-banks do not have the same resources available to borrowers
Over time, borrowers have become more savvy about wanting to learn about home loans first hand, before making a decision. At State Custodians, we encourage borrowers to do as much research as they need prior to even picking up the phone and asking. On our website we have a wealth of information, from blog articles which is regularly updated with the latest news and tips about property and finance to ebooks for a more in depth discussion on different topics, to free calculators and property reports. Our Instant Pre-Approval and Online Application also allow you to assess you borrowing power quickly and proceeding to apply. All of these are available to be used at any time of the day, no matter where you are.
But we don’t want it to stop there. Researching for some people is all about speaking to someone so you can ask questions as you go. Our Lending Specialists have extensive lending knowledge and take the time you need to fully understand your options. Best of all they use language that you can understand and give you their contact details so you can speak to the same person whenever you need assistance.
Applying for a home loan is a huge financial commitment and State Custodians is committed to providing the right information to help you make an informed decision.
Myth: Non-banks do not have as many loan options available
Many non-bank lenders can have the same number, if not more, home loan products available to borrowers than banks. Highly competitive variable and fixed interest rate loans, interest only loans, lines of credit, loans with or without annual fees, SMSF loans and loans for self-employed borrowers and those with bad credit are just a few of the different types of loans that many non-banks offer.
When it comes to the big banks, there is often a ‘one size fits all’ approach and if you do not fit the criteria for a certain loan, you cannot apply. However, when it comes to non-banks, many have a more personalised and flexible lending process and if you do not fit the criteria for one loan they may have other options that will allow you to do what you want to do.
At State Custodians our Lending Specialists work hard to find solutions. They can source a suitable loan for you from our own State Custodians loans or loans from 25+ lenders on our lending panel. Having that breadth of knowledge of the full market is invaluable in finding the best option for you.
If you would like to see how a non-bank lender can help you get a better deal on your home loan, then give our Lending Specialist team a call on 13 72 62 or leave your details here and they will contact you.