Women Are Taking The Lead

The Age

Wednesday November 28, 2001

GARY LaPERSONNE

Just a decade ago, most women found it hard to get a loan and needed a male guarantor. But in recent times there's been an about-face, particularly with home loans.

Although the normal rule of the 'four Cs' apply to any potential borrower, some financial institutions are going further and specifically targeting the female market.

The four Cs are:

Capacity: The ability to demonstrate you have the funds to service the debt. The normal guide is up to 35 per cent of your gross income.

Collateral: Every credit decision is based upon the percentage of the loan value against the value of collateral being offered (in this case, the house you intend to buy).

Character: A client's employment and loan repayment history. This would include two years' tax returns, two or three concurrent payslips and evidence of any savings.

Commonsense: The credit provider must be assured it's a wise investment.

Once you meet these requirements, you have a number of options, with more than 1300 mortgage choices currently on the market.

For women, new loans are now being tailor-made to meet their needs with research showing a huge boost in the number of females inquiring about loans.

In fact, when it concerns choosing a finance provider, one lender has found that more women than men have the final say.

RAMS Home Loans reports that its mobile home loan managers (HLMs) believe about 70 per cent of women have a better understanding of the mortgage market. And 54 per cent say females are responsible for the final decision when it comes to signing on the dotted line. Consequently, the non-bank lender has introduced HLMs dedicated to serving the home market.

"Female inquirers often find it less intimidating to talk to female HLMs," a spokeswoman says. "They find other women can empathise with them, for instance, when they want clarification or don't understand a statement."

RAMS general manager of marketing Dean Grice adds: "Women are critical in defining and researching the short list of lenders and have an active role in the decision-making process.

"Females appear to be more diligent at investigating the options and more thorough than men when asking questions."

Typically, he says, women seek details about fees, associated costs and ongoing service.

While both men and women seek concise information on interest rates, men are more likely to inquire about quick debt reduction, whereas woman seek greater flexibility that will enable them to reduce or even stop repayments.

RAMS' statistics reveal women account for 44 per cent of 5000 telephone inquiries each month - up 18 per cent from 1999.

The lender's home loans available for women now include alternatives such as a lifestyle option that allows borrowers to reduce payments to half. It's aimed at those who stop work for maternity leave or other commitments.

For RAMS' mobile HLMs for women, phone Anita on 0409 762 680 or Georgia on 0409 762 689.

Top 10 standard variable loans**
Banks
Lender                  Product                         True rate
Lender rate     Total                   Ongoing         Exit fee

                        name                    AAPR*
upfront fees    fees
Super Members'
Home Loans              Members' Choice                 5.74%           5.74%
        Nil     Nil     $200
ING Bank        Standard                Variable                        6.20%
        6.20%           Nil     Nil     $100
Macquarie Bank          First Choice Variable   6.22%           6.15%
$385    Nil     $650
AMP Banking             Advantage Home Loan     6.31%           6.20%
$600    Nil     $150
HSBC                    Standard Variable               6.33%           6.20%
        $755    Nil     $150
Non-banks
Lender                  Product                         True rate
Lender rate     Total                   Ongoing         Exit fee
                        name                    AAPR*
upfront fees    fees
HomePath                Standard Variable               5.40%           5.40%
        Nil     Nil     $100
RESI Mortgage Corp.     Complete Home Loan      5.55%           5.50%
$270    Nil     Nil
Melbourne Credit Union  Freedom Home Loan       5.60%           5.60%
Nil     Nil     $430
Wizard Mortgage Corp.   Essentials Loan                 5.83%           5.70%
        $760    Nil     $285
BMC                     Mortgage Home Loan      5.95%           5.84%
$615    Nil     $150
* AAPR is the annualised percentage rate - the rate after extra fees and charges
 are taken into account.
** Rates are for loans of $75,000-$175,000 in Victoria for owner-occupied homes.
Compiled by Cannex for www.interestrate.com.au (November 21).

© 2001 The Age

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