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Higher interest rates, increased fees, less flexibility and fewer options. That's how borrowers could lose out if the banking Royal Commission's recommendations around how mortgage brokers are paid are implemented. By now you've seen in the news that the banking Royal Commission recently recommended that the cost of using a mortgage broker should be transferred from the banks to the customers. Now, first things first: We're here to help and will continue to act with your best interests … [Read more...]

Lack of transparency around bank-offered rate discounts is costing borrowers money

There's so much information available online these days about the latest home loan offers, interest rates or special deals. Which is great for borrowers, because it means we're all more educated and informed than ever before. This in turn allows us to make better financial decisions. BUT... only if the information we're looking at is telling us the whole story.... The Australian Competition and Consumer Commission (ACCC) released their 'Residential Mortgage Price Inquiry'  Report late last … [Read more...]

Are you thinking of switching to a fixed rate home loan? – Feb 2019

Anyone thinking about locking into a fixed rate loan will generally spend a little time considering the future movement of interest rates. Below we share some tools that can provide insight into what interest rates are expected to do over the short-medium term. We're currently looking at what these tools may be indicating and share the results below, as at 20 Feb 2019.   Cash Rate Futures Yield Curve The Cash Rate Futures Yield Curve shows how the market expects  interest rates … [Read more...]

APRA removes Interest-Only restrictions

On 1 January 2019, Australian Prudential Regulation Authority (APRA) removed its restrictions on Interest-Only residential mortgage lending. The restrictions were put in place as a temporary measure back in March 2017, to reduce the level of Interest-Only lending and improve the quality of lender's mortgage portfolios.   So why have the Interest Only restrictions been removed now? APRA announced the move late in 2018, just weeks after CoreLogic figures showed Australia's housing … [Read more...]

Increasing numbers of borrowers are turning to mortgage brokers

Property buyers are turning to mortgage brokers in record numbers, which is good news for both of us. We know we're beating our own drum a little bit here, but please bear with us. In a time when the royal commission is dominating headlines and consumer confidence in the big banks is tanking, the mortgage broking industry as a whole is proving worthy of people's trust. During the September 2018 quarter, mortgage brokers settled an unprecedented 59.1% of all residential home … [Read more...]

Is your Interest-Only loan term about to end?

It's the end of the road for 900,000 borrowers on Interest-Only loans, as they'll automatically switch to Principal and Interest loans this year. If you have one of these loans, now's the time to find out what your options are. At the height of the property boom back in 2014-15, around 900,000 Interest-Only loans were taken out, according to an article published recently by the Australian Financial Review. Many of these loans are fast approaching the end of their 5 year Interest Only … [Read more...]

New Year, New You?

Each year so many of us make New Year's resolutions that focus on our health and wellbeing. But what about making resolutions to improve your finances? Here are four ways to save money in 2019.   #1: Cut back on credit card purchases According to ASIC, the average card holder is paying around $700 in interest per year (on the assumption their credit card interest rate is between 15 and 20%.) Surely you could find better ways to spend $700! A year’s worth of home and … [Read more...]

1 in 3 people know there are better deals out there, but still don’t take action

The latest Deloitte Access Economics' latest report makes for pretty interesting reading. It turns out the average Australian has a, “wide-ranging hesitancy to make any sort of change” when it comes to their mortgages and other financial products. In fact, a reported 41% of Australians with a mortgage don't check for interest rate changes because they either have no interest, don't know what the RBA cash rate is, or don't see its relevance. Does it surprise you that educated borrowers … [Read more...]

Download your 2018/19 Canberra Land Values & Property Prices Report (Nov, 2018)

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Canberra Housing Prices

It may seem as though every time you open a newspaper there's another story about the sky falling in on the property market. But what's actually happening?  We've all seen the news. Auction clearance rates are down, property prices are dipping, loans are becoming harder to source. Housing prices in Sydney and Melbourne have experienced the most significant drop, with Chris Richardson from Deloitte suggesting prices in these areas could be falling as, "much as $1,000 a week.” Richardson … [Read more...]

If you want your loan approved, here are five things to avoid

Due to the banking royal commission and increased lender regulations, it's no secret that lenders are cracking down on home loan applications. Applications that would have been approved in just a few days last year, are now being put under the microscope for much longer periods. To give yourself the best chance of having your loan approved, here's five things you want to avoid.   1. No proof of genuine savings Lenders use the term ‘genuine savings’ to describe funds you've saved … [Read more...]

What does “loan serviceability” mean? How is it calculated?

If you already have a home loan, or have started to think about getting one, you've probably heard the term "loan serviceability." Serviceability is one of the key things a lender will assess before they approve a loan, but what is it? And how is it calculated? Here's some insight into how loan serviceability is determined and why your choice of lender can dramatically impact your capacity to service a loan (and therefore secure the funds you need to buy the home you want). When a … [Read more...]

Buying a house? Here’s what you need to know about paying your deposit

So you've finally found the property of your dreams and you can't stand the thought of someone else moving in?! We know what that's like - we've been there too! BUT... don't rush to hand over your hard earned deposit, without understanding the timing of things. One of the most common questions we're asked is when and how to make the deposits on a new property. Whilst the process varies slightly from state-to-state and in private sales vs auctions, the following gives a general idea of … [Read more...]

What makes your debt tax deductible?

There are two kinds of debt in this world: the kind that is tax deductible and the kind that isn't. Knowing the difference, and how to plan your purchases accordingly, can significantly improve your cashflow, opportunities and overall financial position. So what makes debt tax deductible or not?   Non-tax deductible debt Let's start by clarifying that we're talking about whether the interest on a debt is tax deductible. A non-tax deductible debt (also known as 'bad debt') is … [Read more...]

Moving on up: you and interest rates

You would have seen over the last few weeks that lenders have started to raise their variable home loan rates. We spoke it about it here previously, suggesting that a rate rise was imminent. But now that it's happened, what can you do about it?   Find out what your lender is doing Usually when one of the big 4 banks makes a move, the rest will follow. That's because the first bank to move their rates generally gives the others cover. The first lender takes all the heat and the … [Read more...]

RBA Interest Rate Decision – September 2018

At its meeting today, the Board decided to leave the cash rate unchanged at 1.50 per cent. Here are Phillip Lowe's comments with respect to the Australian housing market. Inflation is around 2 per cent. The central forecast is for inflation to be higher in 2019 and 2020 than it is currently. In the interim, once-off declines in some administered prices in the September quarter are expected to result in headline inflation in 2018 being a little lower, at 1¾ per cent. Conditions in the … [Read more...]

Negotiating a Settlement Period

In a perfect world, you find the perfect home - complete with white picket fence - and settlement goes through on the agreed date with any dramas. So you don't end up with a truck full of moving boxes and no home to move into, here are a few things to consider when negotiating the settlement period on your next property purchase. When you buy property, there will be a 'settlement period'. It refers to the time that occurs between signing of the contract and completion of the sale i.e. … [Read more...]

Q&A Video: What’s the point of Reviewing your Home Loans?

What benefits can you expect from reviewing your home loans? (In addition to saving money, that is!) Watch our short video to find out. … [Read more...]

Can shopping with Afterpay affect your ability to buy a house?

Afterpay is the largest buy now, pay later scheme in Australia. In fact, Afterpay had more than $1.45 billion pass through its platform in the first three-quarters of last financial year. It boasts more than 1.8 million customers, who mostly use it for online shopping, and 14,000 retailers under its wing. The reason for Afterpay's rapid rise is its interest-free, instant purchase business model. To qualify, all a customer needs is a debit card, enough money for the first instalment … [Read more...]

RBA Interest Rate Decision – August 2018

At its meeting today, the Board decided to leave the cash rate unchanged at 1.50 per cent. Here are Phillip Lowe's comments with respect to the Australian housing market. The latest inflation data were in line with the Bank's expectations. Over the past year, the CPI increased by 2.1 per cent, and in underlying terms, inflation was close to 2 per cent. The central forecast is for inflation to be higher in 2019 and 2020 than it is currently. In the interim, once-off declines in some … [Read more...]

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