Their bank said we WERE TOO OLD
John and Sarah (not their real names) were living their ideal life. They were working on a farm, raising cattle. At the same time they had a rentel property that upon retirement, they would sell and buy a unit to live out their days. But things were getting tight, they were struggling to afford their rental property and so went to the bank to see if the they could extend the loan term to reduce their repayments. Unfortunately for them their bank said NO.
The bank advised them that due to their age they couldn't extend the term off the loan as they would never be able to pay it off. The banker advised them "You are better off selling your property as their is nothing they could do to reduce the mortgage repayments." John and Sarah were beside themselves.
They had worked hard all their life, and to them it made a lot of sense. They wern't concerned with paying the mortgage off in 10 years as they knew when the time come they would sell the property, pay off the mortgage and with the proceeds buy a unit outright. But they wanted to stay in the market, they didnt want to be in a position where they sold now and miss out on the capital gains over the next 5 to 10 years. If that was the case they may never to be able to buy again.
After getting a NO John and Sarah contacted Mango after being referred to us by a financial planner. While their situation was diffucult, especially considering the tightening of the mortgage market over the last 2 years we were confident it wasn't impossible. The current tightening by APRA has made it very difficult for the banks to lend to older borrowers.
In the end we managed to refinance their home loan and by extending the term of the loan we reduced their repayments from $2,388 to $1,432.67 per month. That is a reduction of $955.33 per month in repayments.
John and Sarah are now able to continue working on the farm and are no longer struggling with repayments. Their rental property is in a position that it is putting money into their bank account not taking it out.
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At Mango helping clients get the best solution is in our DNA. We believe common sense should be applied to every situation. So when it makes sense, we work hard to find the right lender for your situation. No is not in our vocabulary, so if you have been told no, or you just want a better deal, give us a call.
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