MKM Capital Home Loan Review
Owned by: Privately-owned
Funded by: Private investors
LMI Provider: Self-Insured
Lender type: Non-Bank, Specialist Lender
MKM Capital is a specialist lender that focuses on helping customers that don’t meet the policy of the banks or other specialist lenders.
MKM is here to help the people that are being let down by other lenders. Good people in tough situations. We’ve applied with MKM to fund the completion of partly built houses, assist people who are about to be evicted and to give people with a failed business a second chance. They do this type of lending in a responsible way, but they’re going to charge a higher rate to get the job done.
They’re not trying to be all things to all people and they certainly aren’t the lender to go with if you’ve got a clear history, can prove your income and you’re trying to buy a home.
Lastly, they’ve got the strangest source of funds in the industry…
How do MKM’s home loans compare?
They’re great at
- Common sense lending rather than using strict credit guidelines
- Low doc loans and start-up businesses
- People who have a seriously impaired credit history including mortgage arrears
- Customers who are about to be evicted but can afford to make their repayments
- Refinancing a home loan to pay out a bankruptcy or Part IX agreement
- Refinancing a house that is partially-built
- Refinancing expensive caveat loans or ATO debt
- Vacant land as security accepted
- Reputable and responsible
- Working with mortgage brokers
- Fast loan approvals
But they’ve got some drawbacks…
- They usually have higher interest rates and fees compared to other specialist lenders
- For some home loan types, fees are quoted on a case by case basis
- You’re better off applying with a bank if you’re in a good financial position
- They don’t offer fixed rate home loans
- Their risk fee, which is similar to LMI, can be expensive
- No branch access
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Are MKM Capital reputable?
When your mortgage broker recommended MKM Capital you probably didn’t know who they were. MKM is one of the smallest non-bank lenders but they are a member of the MFAA and they hold a credit licence just like other lenders.
We’ve worked with them many times on some tough loan scenarios and they’ve always been professional, efficient and fair in the way that they deal with their borrowers.
What home loans types do they have?
MKM Has four loan types based on your credit history:
- Clear isn’t for people with a clear credit history, it’s for people who have small defaults or have had a credit issue long in the past.
- Near is for people who just miss out on clear. Typically someone discharged from bankruptcy a year ago or who is a little behind on their home loan payments.
- Specialised / Vacant Land is for seriously impaired credit such as someone who is three months behind with their home loan. It’s also for people financing vacant land.
- Recovery is for actually paying out a bankruptcy or someone who is more than three months behind on their home loan. It’s a second chance for someone who is in serious trouble.
MKM also has their Salaried or Self-Employed option with each loan depending on the source of your income.
How do they work out my interest rate?
MKM have a product matrix which has your level of credit impairment on one side and the size of your deposit on the other.
Having a clear credit history and and borrowing 60% of the property value or less will mean a competitive interest rate. Whereas having significant problems with your credit file and a smaller deposit will mean an interest rate that is up to 4% higher.
Interestingly, they don’t actually charge more for a low doc loan but rather look at whether you’re salaried or self-employed.
It’s not as simple as a bank where there is one interest rate for everyone. Therefore, it’s best to ask your mortgage broker for a quote and ask them to compare it to other non-conforming lenders.
Where do their funds come from?
Rich South African investors. Seriously!
This is actually a big strength of MKM. They can pretty much lend to whoever they want as long as they comply with the NCCP act and lend responsibly.
What that means for you is that they can help a lot of people who aren’t considered by other specialist lenders such as Pepper, La Trobe, RedZed or Liberty.
MKM Capital client story: Tim, Vic
- To complete construction on his dream home.
Owner builder, construction, sole source of income is income protection payments.
After being severely injured on the job site, construction worker Tim could no longer work but was able to access income protection insurance.
Feeling that life was too short, he wanted to build a dream home for him and his family and use the equity in his home to finance the construction.
He had already spent around a million dollars on the build and needed to cash out more. Unfortunately, he couldn’t find a lender that would accept the partially-complete property and income protection insurance as his sole source of income.
MKM was able to accept 100% of his income protection insurance because the payments was for life, and they were also able to use the land value as security for the construction loan.
As a private lender, MKM are very flexible with their lending policies if you can present a strong case.
They’re also one of the very few lenders that will do cash out for construction using just land value.
Compare MKM Capital to other lenders
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Talk to one of our mortgage brokers by calling us on 1300 889 743 or complete our free assessment form.