Archive for Banks

3 ways to help prepare for interest rate rises

The latest news that all of the big four banks have lifted their interest rates on owner occupier home loans, and a number of non-major banks following suit, will see many Australians will now be facing an increase in mortgage repayments.

This will no doubt impact a lot of household budgets and to help you prepare here are three things you can do;

1. Do the Numbers

First work out how much your additional payments will be. Knowing exactly how much extra you will pay each month and year will help you prepare your budget.

To help you do the sums; you can use our mortgage calculator by inputting your exact mortgage details or speaking with your mortgage broker – they can run the numbers for you.

2. Set a new Budget Plan

There’s not a lot of point of working out how much extra you have to pay on your home loan if you don’t apply it to your household budget.

Write a new budget plan with your new mortgage repayments and assess how comfortably you can meet it. You may find that you are going to struggle financially, so take the time to look for areas where you can save money. It may be necessary to change your spending habits in order to adjust to the increased repayments.

The important thing is to plan straight away to avoid any nasty surprises down the track.

3. Consider your Options

An interest rate rise is something you need to prepare for, do your research and make the right, sometimes difficult choices.

Doing the numbers and setting a plan are two parts of the puzzle but in the end you still need to make your payments.

Have you looked into changing the frequency of your repayments? It might be easier to manage and less of a burden paying weekly or fortnightly repayments rather than monthly – or vice versa.

Maybe you have some savings and are able to make a lump sum payment? A lump sum payment could make a dent in your mortgage and could even help offset an interest rate rise by putting you ahead.

Is refinancing or fixing your interest rate an option? This is probably the hardest question to answer and requires a lot of research.

To get help you make the right choices with the research done for you, my advice would be to see your mortgage broker or let me know and I can put you in touch with my mortgage Guru!

Happy New Financial Year for 2015/2016

I would like to wish you a very happy and fortuitous new financial year. We hope the 2014 Financial Year was prosperous for each of you and hope that you enjoy plenty of success in 2015.

Like the calendar new year, July is a good time to set New Year’s resolutions for your business and personal financial prosperity.

Planning to spend time on your business rather than in your business is critical to achieving sustainable business success.   Why not consider;

  • Preparing, reviewing, or updating your business plan
  • Review how your achievements in FY14 measured up against your goals and determine what you need to do differently in FY15 to get a better outcome?
  • Consider your business succession plan (it’s never too early to start)
  • Review your finances – can you get a better deal on your general insurances, home loan, business loan, equipment leases?
  • Have you considered salary packaging to increase your take home pay and benefits?
  • Future finances – How will you support yourself in retirement – who should you consult?
  • Estate planning – establish or review your Will and speak to your family about it so they are aware of your wishes.

Call your accountant to help you with your tax planning.

Are you paying high rates on your mortgage? Talk to my Guru and save buckets of money!

Every time I learn something new I do some research on it and when I am sure of all the facts I like to share my knowledge and help everyone.

I am a slow learner… Even though I buy investment properties, I had always trusted someone else to look after me with my mortgage rates as I was too busy selling real estate… until not too long ago!

Just by accident, speaking with someone about rates I discovered that I could go directly to my bank and ask them “what can you do about dropping the interest rate that I am currently paying” And guess what? They did!

After more research I found out that I could ask my bank if they could drop to 4,65% as another “mob” was offering me that rate  and guess what? Yep, they did! Gosh! That was amazing!

So I told a friend of mine to do the same with her bank but her bank was not able to offer what mine did for me. Even when she asked them how much it will cost to discharge her mortgage so she could go elsewhere, her mortgage officer did not try to retain her by offering a better rate.

I cannot assure you that you can get 4.65% rate or better but I can direct you to the right person to find out how much you can be offered.

It will cost you nothing to ask. Its never too late! I learned now, still in time to get the benefit of what I learnt.

Call me and I will redirect you to my “Guru” to help you to save “buckets of money” like me!

Financing for better rates. Is it possible?

I have been selling real estate for a long time now and sometimes I advise my clients to go to a Broker to get their finance when they have not approached anyone else.

Talking to a lot of people I have found out that they just accept whatever the Banks are offering and also discovered that many of them are not aware that you can ask for discounts on the rates they are offered.

I came across a fantastic contact that has offered me and my clients an opportunity to get better rates that are being offered.

So if you are interested in having a chat let me know.

Two Separate Banks and Two Separate Experiences for the Same Finance Approval

I have just sold two properties of similar value for two clients.

Both clients works in a Bank ( different banks) and both are borrowing the same amount and  have the same borrowing capacity but have very different experiences.

Both are pre approved and each have been working in the Bank for over 15 years. They were confident that they would get the loan in 3 days and they both insisted that I put one week finance on the Offer and Acceptance.

Being as cautious as I am, I put three weeks finance on the offers to be on the safe side.

The first client hassled her Bank daily and was very cross because of lack of communication with her own Bank and used the entire three weeks to get the finance approved.

The second client took one week to get his finance approved and when I asked him what he did he said well first of all I wanted to prove to you that I would get it approved in one week as I had mentioned my first client and her story. Secondly, he had all his paperwork ready to go and spent time with the Bank Broker to get it all sorted and make sure everything that was needed was easily accessible to make sure it all runs smoothly.

Getting finance approval can take some time, effort and patience so I find that weird how can a Bank be so slow and the other so proactive?

Tell us your experience with Banks! Have you had a really good experience? Or maybe one that was not so good and you’d like to share it to help others.

Interest rates below 3 per cent since it began setting monetary policies in 1990

In an attempt to counter slowing growth in the country’s mining sector, the Reserve Bank of Australia announced a decision to lower the cash rate by 25 basis points, effective 8 May 2013.

With a record low of 2.75%  the NAB was the first of the big four banks to lower its standard variable home loans. It cut the rate by 25 basis points to 6.13 per cent per annum.

Commonwealth Bank also passed on the full rate cut this afternoon, lowering its standard variable home loan rate to 6.15 per cent with effect from May 13.

Westpac lowered its rates just before 5pm today, bringing its standard variable mortgage rate down by 25 basis points to 6.26 per cent, with effect from May 20.

After NAB and CommBank’s moves to pass on the 0.25 basis point cut in full, Westpac said they had put their interest rates under review. ANZ Bank will make a decision on interest rates on Friday as part of its regular review.

The cut would be welcomed by families and by small businesses and would provide a boost to other areas of the economy and help sustain long-term growth.

For the first time since I managed it myself, I made money from my Super Fund

Sometimes you make a decision that should have been done 10 years earlier, but now my hindsight can help you!

Did you know that when you turn 55 years of age you can self manage your own super? Until last year I had my Superfund looked after by someone else and now I see that I lost the chance to be richer as I could have started to manage my superfund a long, long time ago.

I wrote a post last year that said the superannuation fund was a joke  and although I was being honest and outspoken with my opinion I got a lot of negative response from Brokers (which I appreciate their opinion) but did not agree with them.

Between myself and my husband we did not have a lot of money as all the money we put in to our Superfund throughout the year it “ate it” with bad investments and fees.

This year by self managing my Fund myself  and including the money we put in we increased our savings by 20%. If I had left my money in the Super I would probably had increased another $10000 for the year but what happens to the other $50000 I put in. And they are trying to tell me I made money?

So doesn’t it make sense to manage it myself? I am not a Finance Advisor ( God forbid) and none of those people agree with me but I just use my common sense and it looks like it is working.

If you are over 55 then you can self manage your Super too!

Good luck & Feel free to ask me any questions!

The Reserve Bank of Australia finally cuts interest rates to 3.25% the lowest in 3 years

The Reserve Bank of Australia decided to finally cut interest rates at their official meeting, lowering the cash rate by 0.25 basis points to 3.25% – the lowest in 3 years.

Despite the Reserve Bank delivering an early Christmas present, only the Bank of Queensland have moved .20 with the other big banks still in discussion. Should the banks decide to pass the cut the decision will see repayments on the average mortgage of $300,000 drop by almost $50 a month.

Take a look at the Interest Rates from January 1992 to October 2012.  What are your thoughts about the decision?

Australia Interest Rates January 1992 to October 2012