Quick Summary
Founded
1999
Owned by:
Cerberus Capital Management
Funded by:
Wholesale money markets
LMI Provider:
Self-insured
Lender type:
Non Banks, Specialist Lender
Bluestone Mortgages was a very successful non-conforming lender up until the onset of the GFC in 2007. It laid dormant until 2013 when it resumed lending in Australia.
As a specialist lender Bluestone Mortgages is a good choice for borrowers who don’t meet standard lending criteria. They’re not trying to compete on interest rates so you’ll probably pay a few percent more than you would with a bank.
In 2018 Bluestone was purchased by Cerberus Capital Management which is a large private investment firm. The funding injection that Bluestone received has enabled them to expand their team, lower their interest rates and offer more products to different types of borrowers.
How do Bluestone’s home loans compare?
Pros
- Refinancing and consolidating credit card debt and ATO debt
- Special solutions for borrowers with a bad credit history
- Low doc loans for self-employed borrowers
- Loans for businesses that have just started
- Funding business expansion using residential property as security
- Assessing loans using common sense instead of credit scoring
- Accepts most unusual income types at 100%, but bonus income is shaded.
- Can go up to 90% LVR
- Mixed-use commercial property accepted
Cons
- They’ve got much higher rates and fees than a major bank
- The smaller your deposit, the higher your interest rate
- Other specialist lenders may offer you a better deal
- Their risk fee, which is similar to LMI, can be quite expensive
- They don’t do land and construction loans
- Can’t do non-resident mortgages
- There are LVR restrictions for non-metro locations
- Can’t do off the plan purchases
- Can’t do multiple titles for a single dwelling
What home loans types do they have?
Bluestone Mortgages offer four main products, each catering to a borrower depending on their situation:
Prime: Competitive home loan for those with clear credit and strong employment history.
Near Prime: For borrowers with judgements or defaults of less than $1000, or greater than 24 months. Short term and casual employment accepted.
Specialist: For borrowers who had financial difficulties in the past like bankruptcies and offers more extensive refinancing options.
Specialist +: For borrowers who have had credit issues, bankruptcy and other defaults.
How does my credit impairment affect my rate?
Bluestone will categorise your credit history to be Clear, AAA, AA, A or BBB depending on the number of defaults, recently missed payments on your mortgage and if you have any history of bankruptcy or part 9 agreements.
A borrower that is categorised as Clear will get a better interest rate than someone categorised as BBB. In addition to this having a lower category may mean you need to provide a larger deposit.
Bluestone Mortgages Client Story
Jeffrey & Glenice, SA
Goal
To refinance a mortgage and release money to consolidate debts and fund a business.
Situation
Refinance, consolidation of debts, business finance, low doc business loan.
Background
Restaurant-owner Peter owned a house worth $2 million in a high net worth suburb in Sydney.
His business had struggled during winter which caused him to overdraw several credit cards and miss some repayments on his home loan.
In order to increase his clientele, he planned to renovate the outdoor area of his restaurant to prevent the same problems happening next winter.
Solution
Using business bank statements, we were able to show Bluestone that Peter's business had a stable income over the past several years. It was clear that last winter was a just a bad period.
Based on this, they were happy to refinance his home loan and release equity for him to fund his business. This simplified his situation from having multiple high interest debts to one simple repayment each month.
Although the interest rate as higher compared to other lenders, we created a plan with Peter so he could be in a position to qualify for a lower rate loan in 2 years time.
Find out if you are qualified to apply with this lender
FIND OUT HERETips for applying with Bluestone Mortgage
- Ask your mortgage broker to compare what they can offer to other specialist lenders such as Pepper or La Trobe as it always pays to shop around.
- A good mortgage broker will also try to negotiate with the lender to get a better interest rate. While it’s very hit and miss with specialist lenders, it doesn’t hurt to ask!
- Use Bluestone Mortgage's loan application checklist to prepare for your mortgage application.
- Note: This is the latest application checklist effective November 2020. Please refer to Bluestone Mortgages for their most up-to-date document requirements.