AVOID at all costs - Pre-Approval doesn't mean anything either - Constant stress and lost dream home
Would strongly encourage anyone to look elsewhere. Despite having pre approval months prior. When contract was signed for a house and subject to finance, reduce home loans kept requesting documents to be sent in which had already provided not only since pre-approval but again after contract was signed. I responded to all requests straight away. It appeared they were very disorganised organisation. They then left it up to the FINAL DAY of finance date to deny the application! This will likely result in the seller moving and the whole contract F...ALLING APART. I do not mind the fact that finance was denied, as I could have placed this elsewhere, but their service was diabolical and leaves me in a terrible position. Had they told me at any time in the last 2 months that there would be an issue, since having the same documentation they relied upon, then I would not be in this predicament. It appears internally the actually sign off is by some "credit manager" whom you will never talk too, and they leave this to the last day to obtain their approval internally. Don't bother with pre-approval as it is not worth the piece of paper it is written on and you will be sweating on their decision until actually finance date. Avoid at all costs and don't be fooled with their rates, comes at a price.
They took 4 months for my application. Went to a new lender and got approved in 4 days.
To start with, Reduce Home Loans is just the broker but is falsely advertised as a non-bank lender on their website. In my case, the actual mortgage lender is Mortgage Ezy and the funder is Bendigo Adelaide Bank. And none of that was explained upfront until my solicitor got involved. The multiple layers meant that response was slow (non-existent in some cases), and the process was robotic, inefficient, duplicated, and frustrating.
Disappointed to say the least. Made me anxious and couldn’t sleep as we got closer to the settlement date. They we...re first engaged 4 months ago. I was initial told a 3-4 week approval timeframe. But by the end of the 6 week settlement period, I was still answering their questions on the day before settlement and even the week after which demonstrates that they do not talk to each other. So I had to make other last minute arrangements to settle this on time. Needless to say, the approval didn’t arrive in time and I didn’t end up taking up their loan and went to another lender and got fully approved in 4 days (not weeks). In order to save time while I’m sorting out the contracts, I had applied for the pre-approval 2 months ago. I was told I can go straight for the full approval instead once the contracts are signed. Provided them the draft contract for review at that time. Since the full approval application was submitted, the credit check and the valuation were only requested 2 and 3.5 weeks after the application respectively. The valuation was further delayed when they realised the loan is for a vacant land and there is no house to inspect. They had asked for a house insurance certificate when there is no house to insure. They had also asked me to provide a signed letter for my exit strategy when it is only required if this property will be my principal place of residence which it is not. My bank statements and payslips were submitted with the application to the broker, but the same documents were requested again when it went to the lender for review. All my responses were provided within 2 hours of their requests. Then there would be no response or feedback from them for a few days and then I would get the next question and so on. This went on for the whole time right up to the day before settlement. The lender had also requested a change to the contract 4 weeks after the application (after it has been signed). And then changed their mind on what needs to be changed. I was told they could go to another bank as backup but never acted on it. The cooling off period for the purchase was resurrected 3 times from 1 week to 4 weeks. My solicitor and the vendor’s solicitor were frustrated in dealing with them and with their lack of response to the point that they have lost all confidence and reliability in their words and ability. I was reassured multiple times the full approval is coming in the next few days but that kept slipping.
Questions & Answers
Why are the fees so huge and why are so many members accusing you of bait and switch, where months after they have their loans established they get a letter advising their interest rates are going up?
Some of the comments are quite serious and places doubts on whether Reduce can then be trusted or not if they sign you up on one rate, only to increase it in a few months. Has many people experienced it?
Also people are saying their exit fees are very high. How high are they compared to others?
I am considering refinancing soon with reduce and I was wondering if there rates go up soon after changing over. I was convinced a few years ago by a broker to refinance with AFG and 2 days after my loan changed over the rate went up quite a bit and I would have been better off staying with Peoples choice. I don't want to waste my time changing if this will happen again.
I am an existing customer my rate was 2.42% it will soon reduce to 2.27%. I have not experienced any issues with rates, although I have noticed they are now advertising at 1.77% so do not reward loyalty. The process to refinance is beyond slow, frustrating and you need to jump through hoops expect it to be even months before it is finalised. So you need to weight that up.
I am also an existing customer at current rate of 3.94% IO Investor loan when current advertised is 3.19% for the same product. Contacted my manager who said that no improvements to rate are possible. I'm now looking at refinance for 2 loan products elsewhere closer to the advertised Reduce interest rate. No reward once you are signed up.
They don’t reward loyalty. It’s disgusting they advertise new loans 0.5% lower than loyal customers. Also the discharge fees are excessive!
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