Page 12 - Loan Structure Solutions

more investment properties. We often need to balance out a theatrically
perfect structure with practicality and usability.

Part B: Advanced considerations

5) Multiple lenders

The above case study included Keith and Joanna using three different
lenders (Lender A, B and C). Clients often ask us: should we use
different lenders to spread our risk?

The advantage of using different lenders includes:

Establishing a “credit relationship” with more than one lender can be an
advantage as lenders sometime have different credit policies or pricing
for existing customers versus ‘new to
bank’ customers.

One advantage of having all lending
with one lender is higher interest rate
discounts (that is, you might be able to
get better rates or fees if you use one
lender).

Spreading your lending amongst a few
lenders can be a prudent risk
management procedure, we did see
during the height of the GFC (Global
Financial Crisis) that as the Reserve
Bank was reducing interest rates, some lenders were unable to pass
that on due to their funding pressures. So if you had all of your
borrowings with one of these lenders it would have been costly.

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