Does Your Margin Loan Appear in Your Credit Report?

leonardoryan on 16/12/2019 - 04:02

Does your margin loan appear in your credit report? My mate has 250k margin loan with BT but showing nothing in his credit report, so when he applied for mortgage he didn't have any problem with the amount he was borrowing as the bank didn't take into consideration that he has 250k margin loan. He is however not sure though whether this is by mistake or it's meant just like that.

I'd like to know more on people's experience in this matter as I'm considering to apply for margin loan, at the same time I'm trying to get a new loan for buying property.

Financial

Comments

  • [Deactivated] on 16/12/2019 - 06:38
    +2

    It does appear at time of application. Your friends margin loan couldve been applied for many years ago and the original inquiry wouldve dropped off.
    If youre applying for a homeloan, suggest applying for extra and using redraw facility to use part of mortgage for investing as interest rate will be cheaper

    • malich on 16/12/2019 - 10:47

      Agree with this ^.

      The other possibility is that the margin was applied for under a trust/holding company name.

    • djkelly69 on 16/12/2019 - 12:55

      Claiming the interest deductions for the margin loan will be pretty tricky if it is tied in with their mortgage.

      • leonardoryan on 16/12/2019 - 16:51

        Can this be simply brought to the accountant as we provide the numbers and he/she does the rest?

        • [Deactivated] on 16/12/2019 - 18:49

          Yes, but youll pay a prmium for it as it gets messy. Youve got to portion your repayments for private (homeloan) vs deductible, and interest. Then if you redraw again it gets messier and so on.

    • idjces on 16/12/2019 - 16:56
      +1

      I had the same experience, the initial applications and subsequent limit increases were on my report, but it never showed as a current facility.

      I had a bad experience trying to refinance my mortgage to ubank. My existing mortgage and margin loan were with NAB. When ubank asked about the details for the margin loan, they didn't know what to do with it, they couldn't add any of my shares or dividends to my net worth/income, but they treated it as a $100k credit card limit which I wouldn't be capable of servicing on paper per their approach, and wouldn't approve the mortgage refinance (and this is all within the same parent company NAB).

      I left the margin facility off my next application with loans.com.au and had no issues. I still have it available, but rarely make use of it.

      • leonardoryan on 16/12/2019 - 18:31

        Thank you for sharing your experience. I am guessing every lender have their own policy in regard to margin loan

  • Agarwal on 16/12/2019 - 11:03

    Wouldn't he have had to list this on his loan application?

    • leonardoryan on 16/12/2019 - 16:05

      He did not list the margin loan facility as he was confidence that nothing show up in his credit report. And apparently at the time of applying the bank didnt see either

      • Agarwal on 16/12/2019 - 16:12
        +2

        I am no expert but I would have thought all loans would need to be listed, whether they show up or not, seems fraudulent to me if he deliberately left it off.

        • leonardoryan on 16/12/2019 - 16:49

          Noted. I assumed if anything happened financially, this could trigger to a bigger investigation into the case? Or potentially charged against fraudulent?

          • [Deactivated] on 16/12/2019 - 18:51

            @leonardoryan: Its not fraudulant. You couldve got a credit card 10yrs ago under differant rules. I doubt if youve never sought a credit increase it wpuld be listed. I used to analyse credit applications for a living

  • LemonShapedRock on 16/12/2019 - 17:39
    +1

    According to CBA they don't even consider your margin loan for a Home Loan application and borrowing power calc.

    Traditional margin loans don't have regular repayments like normal loan.

    It'll still be a hit to your credit file though.

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