Case Study - Moving a Client from 'Mortgage Prison' to Achieving $850 in Monthly Interest Savings
Working with a lending specialist team that leverages both their complex lending expertise and premium banking relationships can make a substantial difference in optimising your lending and borrowing position, a key component in successful property investing.
Here’s a case study showcasing how our dedicated lending team successfully navigated a challenging and uncommon, yet frequently
encountered, situation to achieve an outstanding end-results for our client of $850 savings each month.
The Client: Our client, Mr. Peng, approached Ramsey in a difficult financial position. His debt-to-income (DTI) ratio was too high for his income, and every traditional lender declined his application, making it impossible for him to refinance and secure a lower rate. We call this ‘Mortgage Prison’, and it’s not an ideal situation to find yourself in.
A few lenders were willing to consider him but only at an exorbitant 8% interest rate, placing the client in a worse position than that of before.
In need of a tailored solution, Mr. Peng approached us at Ramsey Property Wealth and partnered with our team, who worked quickly to deliver a
solution most Brokers and Lenders wouldn’t want to take the time to review and implement.
The Challenges: Mr Pengs case presented a unique set of challenges:
- High DTI Ratio: The client’s DTI exceeded the standard policy limits, deterring potential lenders.
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Widespread Declines: With initial declines from all potential lenders except a particular bank, the chances of securing a
favorable rate seemed slim at first.
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Time Sensitivity: The client needed a fast resolution to avoid mounting costs, while also hoping to secure a plan to
eventually pay down debt and grow his property portfolio.
Our Approach: Acacia, our dedicated mortgage specialist, took ownership of the case from start to finish. Leveraging her relationships with the particular bank we had options with along with her deep understanding of lending policies, Acacia crafted a strategic plan to secure financing for the client. Here’s how she accomplished it:
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Relationship-Driven Policy Exception: Recognising the DTI challenge, Acacia worked closely with her contact at the
bank to make a compelling case for an exception. She detailed the client’s financial goals and mitigating strengths, requesting a
tailored solution. Thanks to her strong relationship and her efforts to not only unpack the case but also offering a mutual solution, the
case was approved outside the typical credit policy.
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Preliminary Approval Prior to Submission: Acacia’s proactive approach ensured a preliminary approval before the
formal submission, laying the groundwork for a smooth application process.
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Meticulous Application Management: Unlike standard practice, which might involve a single, consolidated application, Acacia
submitted 11 individual applications, ensuring each was fully compliant and tailored to maximize approval chances. She spent four hours on
the phone with the bank’s representative to thoroughly review each document, clarify details, and expedite the process.
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Expert Use of FLEX and Loan App: Her adept use of FLEX and Loan App facilitated a streamlined, one-touch approval process,
which she finalized in just 72 hours without any MFIs (Missing Financial Information).
The Results:
The outcome was a resounding success, providing both immediate and long-term savings for the client:
- An $850 reduction in monthly mortgage payments.
- $33,666 in net interest saved over the next three years.
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Moved from interest-only payments to principal and interest allowed the client to start paying down debt and build equity more effectively.
This case demonstrates Ramsey Property Wealth’s dedication to client-centered, results-driven service.
By going above and beyond to secure policy exceptions and provide a fully managed submission process, our lending team transformed a challenging situation into a win for the client, our team, and our partner.
In-house expertise, diligence, and relationship-building made all the difference, achieving a level of savings and service that reflects our commitment to exceptional client outcomes.
Have a complex situation and find it difficult to go through a bank or broker? Find out how we can help you save on your mortgage?
Contact us at 1300 001 215 today to see why we’ve been awarded 19 times in 6 years.
