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When the financial demands of family life maxed out one couple’s equity and credit lines, BorrowRight broker Iva Rasic found a new passion for difficult deals
THE SCENARIO
Parents of young children are all too aware of how stressful it is to juggle family life and financial responsibilities – the bills keep coming and the children keep nagging for the latest toys, clothes and holidays. To keep on top of everything, and keep up with the Joneses, parents often turn to personal loans and credit cards, but when faced with the full demands of modern family life, these can quickly reach their limit.
Last year I was approached by a young family who, as a result of this very situation, had found themselves struggling under the burden of multiple credit card debts as well as car finance and personal loans.
As responsible but overwhelmed borrowers, their goals were clear: they wanted to reduce the interest on their home loan and tackle their other debts. However, both applicants had complicated incomes and the equity on their owner-occupied property was maxed out.
When I discovered they had already spoken to two other brokers and the branch staff at their current bank before me, my concerns grew. They had been told repeatedly that nothing could be done, and they were starting to lose faith. At our first meeting they laid everything out on the table – tears and all – and asked if I would be able to help them from drowning. For any broker, that’s not a question that can be ignored, so I started to reassess their case to try to find the lucky break they needed.
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THE SOLUTION
That break came in the form of a cross-securitisation on a second home owned by the couple as an investment property.
The other brokers and the branch staff who had previously offered advice had failed to see the potential of this asset, but after looking at the full situation this became the best option on which to base their solution.
I powered through all the paperwork and then explained how we could cross-securitise the two properties to unlock more equity, which could then be used to pay down the other debts. Considering the number of people they had already explained their situation to, the clients were surprised to learn this was even an option, but also overjoyed to know there was a solution on the horizon.
I started to work on the cross-securitisation and, once this was complete, they had more than enough equity and income to pay out all their other debts in one neat repayment. This was a clean sweep of their goals, and because they had freed up so much of their monthly income it transformed their quality of life as a family. This also enabled them to make additional repayments to pay down debt faster, rather than struggling to meet their monthly obligations.
THE TAKEAWAY
With some patient waiting and a lot of effort, we did eventually get approval, and I don’t think I have ever been happier to get a deal over the line than I was on this occasion.
As a young broker at a relatively early point in my career, I glean lessons from every interaction I have. However, I feel as though this one taught me much more than the average deal.
Firstly, where there is a will there is a way, and I learnt that this was a vital attitude to bring to broking.
Secondly, this deal taught me a lot about debt restructuring and consolidation deals, including how passionate I am about them. Not only have I found a niche in my skill set but I’ve also found one in my love for the finance and broking industry, and now I can actively build on that to drive more business.
Since this deal, I have done many more similar deals which means I have managed to help many more clients to achieve seemingly impossible goals. It’s definitely a love-hate relationship, and there are many frustrating and challenging days, but for me the challenge is also the thrill. Additionally, the client is always more grateful when you have this much of an impact on their life. As a result, they are also more willing to recommend a broker who has transformed a source of stress into a positive financial outcome.
Iva Rasic
Broker
BorrowRight
