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, lawyers and teachers are commonly eligible for home loan discounts, or particular loan types without fees, based on their professions. “The benefits differ depending on specific professions,” Jamie Donaldson, co-director of Shire Business Loans, explains. “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.”
An example of this is the slowing down of the mining industry in 2015, which saw mining engineers lose their ‘in demand’ status and their profession-based discounts.
Doctors take the cake
Lenders have their own target lists of professions, but doctors are the big winners. “They’ll get waived LMI, lower interest rates and, in many cases, banks will even go outside of their normal policy to get their loans approved,” says Jamie. “However, not all medical professionals, such as psychiatrists, chiropractors, vets and pharmacists, are accepted by all lenders so it’s always advisable to confirm.”
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,” advises Jamie. “Waived LMI is usually approved without any problems if you meet the criteria, however your mortgage broker may need to negotiate to get a better interest rate as well.”
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.
Contact us today with your extra questions!