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Major banks treat our islandS more kindly when it comes to property and housing finance.

According to island Professional Lending Pty Ltd expert Sandra Thomas, there is a vast difference between the major banks and ‘second tier lenders’ such as the Bendigo and Heritage Banks.

According to Sandra: “The Island lending situation has not changed and has the same pricing and policy as the mainland.

It currently stands at 20% deposit for homes that are to be occupied, and 30% deposit for investment properties.

Sandra Thomas added a proviso: “ Sometimes I can get 80% LVR on investment if it’s a strong deal.

“Acceptance is based purely on the quality of the deal.

“New purchases are fine, but refinance is difficult everywhere due to the APRA ruling on lending institutions percentage of investment that are allowed,” she told The Friendly Bay Islander.

It is different with the second tier banks such as the Bendigo Bank.

A spokesperson for the Bendigo Bank told The Friendly Bay Islander that the requirement for lending on the islands required a deposit of 40%.

Sandra Thomas explained: “The Bendigo Bank and other smaller institutions are not able to lend here effectively due to them being classed a second tier lender.

“This means due to the size of their holdings, all loans they write must be mortgage insured, whereas the big banks only use the general insurers for over 80% lends.

“Genworth and QBE will not insure anywhere in Australia if there is no bridge to the mainland.”

Sandra Thomas explained that island loan applications from the big banks are being received ‘just the same as from anywhere’.

“I also do 40% of my business on the mainland and it’s all the same; it is down to policy.

Service of loan applications is another matter, it seems.

The lending professional continued: “Service depends on their work load; particularly if they are offering special rates. They can get swamped, which holds us all up.

“Some lenders do treat their broker market better than others but I have good relationships with most lenders,” Sandra Thomas said.

• Sandra Thomas

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