Mortgage of the Year 08

Reporter: Marguerite McKinnon

The Great Australian Dream of owning your own home has turned into an horrific nightmare for a growing number of Australians. Many are on the verge of losing the home they can no longer afford and there are new reports the number of Australians suffering mortgage stress will reach a million by Christmas.

But tonight, some hope, as we reveal the best mortgage deal in the country.... and not only that... how you can be one of the lucky ones and own your own home.

It's the mortgage the banks don't want you to know about.

David Westerman's family-run company, State Custodians Mortgage Company is just 2 years old and has only 400 clients but it's beaten 1500 other competitors, including the big banks, to be named Australia's best by "Your Mortgage" Magazine.

"The vast majority of the borrowers that are coming to us are coming from the top 4 banks. Top 4, 5 banks. And they're upset. They're upset. They're paying a higher interest rate. They're getting a lower level of service and standard. They can't talk to anybody and there's absolutely no reason for them to put up with that" says David.

Magazine spokesman Justine Kennedy says while most banks are offering mortgage loans around 9.6 percent, State Custodians Mortgage Company is one of the lowest in the country at 8.7%.

"Extremely competitive rates, very innovative products and you'll find the All-In-One Account features in some of their products as well" says Justine.

Low mortgage rates from new-non-bank-lenders are not only highly competitive, they're giving the big banks a major headache.

"While they're small in comparison to your big four, they're still big enough to provide quality service to anyone that's willing to go across" says Justine.

If the company doesn't rely on mostly overseas funding, customers could also side-step any price hikes from the international credit crisis.

David says "We started State Custodians out of the clear need for a discounted product for the mums and dads out there."

Avoiding extra fees are now more important than ever.

A report by Fujitsu Consulting and Wizard Home Loans says by the end of this year a million households or nearly 1 in 6 (15%) home loan borrowers could be in mortgage stress by Christmas.

"I think the mortgage stress levels we're seeing right now are the most serious we've ever seen, since really back to the 1800's." Respected property analyst Louis Christopher says the Great Australian Dream of owning your own home belongs to just 60% or Australians and it's falling fast. "There'll be a lot more sellers out in the market place and a lot less buyers and our forecast for 2009 is that it's likely we'll see house price falls up to 15%."

Louis Christopher says instead of having massive home loans, Australians should rent and save every cent.

But what about the rental crisis? Until today we've been told it's almost impossible to find a place to rent... Now a new, free and independent national data base proves there are thousand of places available.

"The site we've created allows you to actually look up your own post code, look at the vacancies in your area and it's great for tenants and landlords because it's more transparent, precise information and it's all for free and it's from an independent body which is what counts. And this is national? This is national" says Louis.

The hard part for many home-buyers is being locked into their home loans every lending institution has a penalty "EXIT FEE" - the banks charge around a thousand dollars...but cheaper lenders will charge more...but why leave a cheap rate?

Unless they pay an exit fee.

According to "Your Mortgage Magazine"


Mortgage of the Year 2008
State Custodians Mortgage Company - Standard Variable Loan

Bank of the Year 2008

Non-Bank Lender of the Year 2008
Pacific Mortgage Group


Mortgage Lender of the Year - according to "Your Mortgage" Magazine:

PH: 1300 654 617