With the release of our Funds Position, we have built in the capability to allow for the input of multiple securities. We realise that in building a customer-facing tool, it's not just important to get the maths right, but to communicate in the way that a broker would want us to.
This means that there can be multiple ways of solving the same problem and communicating multiple securities to a client.
There are number of different decisions that you can make when approaching this. These can be around things such as:
LMI, Government Charges, Funds and Fees controls
Cross-collateralisation
Moving surpluses between securities
Creating and resolving deficits
Changing "New Loan Amount" or "Desired Surplus" for refinances
The following examples are to show you the different ways you can approach this and the different choices you can make when communicating multiple securities.
Example 1 - One Funds Position with two securities, Cross-Collateralising
Example 1 - One Funds Position with two securities, Cross-Collateralising
Below is an example of:
Two securities into one funds position,
Cross-Collateralising, bringing LMI to 0 due to total LVR being less than 80%,
Adding a the parent's security as a "Security Only"
Example 2 - One Funds Position, Creating and Moving Surpluses.
Example 2 - One Funds Position, Creating and Moving Surpluses.
Below is an example of
Securities into two different funds positions,
Overriding LVR to 80%, eliminating LMI and then resolving the resulting deficit with a surplus in the other security,
Allowing the $308.40 government charges to remain as a charge, in this case increasing the refinance loan amount.
In this situation, you could also choose to Change the "New Loan" amount in the refinance instead of the "Desired Surplus". You would do this if you prefer that number to be rounded to the nearest thousand.
Example 3 - Two Funds Positions, Overriding LMI, Overriding Govt Charges
Example 3 - Two Funds Positions, Overriding LMI, Overriding Govt Charges
Below is an example of
Securities into two different funds positions,
Overriding LVR to 80%, eliminating LMI and then resolving the resulting deficit with a surplus in the other security.
Overriding the $308.40 government charges to remain as a charge, in this case increasing the refinance loan amount.
The reasons for choosing exactly how to do this can depend on the specific situation, the broker, the client and many other factors. It's all ultimately up to what makes the most sense to you and what you believe most clearly communicates to your customer.