flagFounded: MyState around 1960, The Rock Building Society 1967
businessOwned by: ASX Listed
monetization_onFunded by: Retail deposits and wholesale capital markets
securityLMI Provider: Genworth
account_balanceLender type: Regional Bank
MyState Bank is an unexpected mix of MyState, a regional Tasmanian Bank, and The Rock Building Society, a Queensland Building Society based in Rockhampton. They merged in 2015 and their greater scale has enabled them to offer more competitive home loans across Australia through their mortgage broker partners.
MyState offers a good combination of competitive interest rates and niche lending policies which has enabled them to get some traction. However most borrowers don’t know who they are unless they’re a local in one of their home regions.
How do MyState Bank’s home loans compare?
They’re great at
- 95% home loans even if your deposit is a gift
- First home buyers
- Market-leading interest rates if you have a large deposit
- Self-employed home loans as they accept one years’ tax returns or the most recent one
- Mature age applicants and retired guarantors
- Financing properties in Tasmania (TAS)
- They require less statements if you’re refinancing your home loan
- They lend up to 95% of the cost of construction
- Financing the construction of a duplex
- Working with mortgage brokers
- You can use the BOQ and NAB ATM network with no fees
- You can provide simplified income evidence if you’re self-employed
But they’ve got some drawbacks…
- Their banking systems are outdated which can cause massive delays
- They’re unlikely to help people with a bad credit history
- They don’t have a large branch network
- They can’t help self-employed borrowers who have little to no income evidence
- Depending on how busy they are, they may be slow to assess your application
Coronavirus / COVID-19: MyState Bank policy changes
MyState Bank has announced that they won’t be accepting income from industries affected by the coronavirus (COVID-19) pandemic for borrowing power assessment (serviceability).
These industries include, tourism and travel-related services, hospitality and accommodation, event planning, entertainment, retail sales sector, real estate services and manufacturing industries. However, they will continue to lend to borrowers working in these industries.
MyState has also announced they won’t be accepting dividend income and will only use 50% of acceptable income from commissions, overtime and bonuses.
Similar to a lot of other lenders, they’ll also be verifying employment for all home loan applications.
In addition, they are now able to use the JobKeeper payment for the servicing of PAYG borrowers. The following documents for proof of income are required with the loan submission:
- Last 2 payslips showing the current income level; and
- Payslip from pre-COVID19 changes (16th March) showing the normal income level.
The lender will be using the JobKeeper payment income only if your current salary is less than the pre-COVID-19 income.
Coronavirus / COVID-19: MyState Bank mortgage relief
MyState Bank is offering customers financially affected by the current crisis the option to defer their home loan repayments (mortgage holiday) for up to six months, with a check-in (review) in three months.
Remember, during this period of no repayments, interest continues to accumulate and is added to your home loan balance. At the end of this period, your repayments will increase so that the loan is paid out within the original loan term.
Alternatively, you can:
- Reduce your repayments to the minimum required.
- Access any additional repayments you may have made through redraw. They’ve also removed the fee for accessing those funds.
To apply for a repayment holiday, please visit their website.
What home loans types do they have?
These are home loans that are left over from the merger of The Rock Building Society and MyState Bank. It can get a little confusing.
The Essential Home Loan is a basic loan without many features but it has a good interest rate. It’s ideal for loans under $250,000.
The Rock Star Package is a competitive professional package that offers great rates if you are borrowing less than 80% of the property value. It has an offset account and discounts on other banking products in return for an annual fee.
Their Fixed Rate Home Loans are usually quite competitive, however, it always pays the shop around.
Despite being a smaller lender, they actually have a sophisticated credit scoring system with a Scoreband from 6 being a low risk to 1 being a high risk.
What this means is that although they offer 95% home loans they aren’t handing them out like candy. You need to be in a strong financial position to qualify for them.
In addition to this, their LMI provider Genworth will also score applications, and they’re particularly tough on single borrowers or people with no genuine savings.
Tip for applying with MyState Bank
Use MyState Bank’s home loan application checklist to prepare for your home loan application.
Note: This is the latest mortgage checklist as at November 2017. Please refer to MyState Bank for their most up-to-date document requirements.
MyState Bank client story: Alison, QLD
- To refinance a home and buy an investment property.
- To have a fixed rate and the ability to make extra repayments.
Refinance, purchase an investment property, flexible fixed rate.
Alison and her husband had paid off most of their mortgage and were looking to invest for their retirement. They wanted to buy an investment property using a home loan with a low fixed rate.
However, Alison’s husband was expecting to receive an inheritance in the next two years so he wanted to have a fixed rate loan that would allow him to make extra repayments and pay down the loan faster.
The Rock Building Society (which is now called MyState Bank) allowed unlimited additional repayments with their fixed rate home loans.
The Rock was able to refinance the couple’s mortgage and use their equity to fund their investment property without the need for a deposit.
Compare MyState to other lenders
Not sure which lender is right for you? Our Home Loan Experts can help!
Talk to one of our mortgage brokers by calling us on 1300 889 743 or complete our free assessment form.