Archive for Mortgage

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!

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!

Find out how much your monthly mortgage is with our easy to use mortgage calculator

Are you thinking of buying a first home, new home, investment or just want to see what your monthly mortgage is?

With our new mortgage calculator, all you need to do is fill in the details and voila! instant calculations. Go ahead and try any combinations you like.

Selling Price$Deposit$
Interest Rate%Years
Monthly Payment$Change any combination of fields to calculate.
Please note the results from these calculators are an approximate guide only. This calculator, or the results generated, do not constitute any agreement by any lender to provide credit.

Preparing For Re-Financing before buying or selling a new home

Financing Basics

When you make the decision to sell your home, you’re entering an active real estate market. If you play your cards right, your home can sell fast. An overwhelming number of buyers borrow money to purchase real estate, so understanding how the lending process works is important.

Calculating your Budget

If you don’t already operate from a formal budget, part of the process in selling your home should be to create a financial statement that shows your income, your debts, and how your finances fit into the big picture. Finance professionals can help you with this, but the process isn’t hard if you follow a few basic steps. From the your big picture financial statement, prepare a budget that includes all of your monthly fixed expenses (current mortgage, car payments, utilities) and your best estimates for the variable ones, such as food, gasoline, and entertainment. As you document this information, make note of the balances on any outstanding loans and how much you are paying each month. If you have some small debts hanging out there, it’s a good idea to pay them off. A budget can help you see areas where you can reduce monthly spending in order to apply the savings to paying down your debts.

What Lenders Are Looking For

While a history of responsible credit is good when applying for a loan, too many small loans or debt obligations are not. A good rule to consider: the fewer debts you have on your financing application, the better. Many finance experts recommend that if you have several small loans, you consolidate them into one loan to achieve a better interest rate and an easier to manage payment system. This also may look more favourable on your loan application than several smaller debts and obligations. Once you have paid down any debts, and once you have consolidated your smaller loans, speak with your current lender as well as other banks to find out how much money you can qualify to borrow for a new home. Once a lender has told you how much you can borrow, you will have an important piece of information to use when looking for your next home or evaluating offers on the home you are selling. When determining your borrowing power, also keep in mind any costs that may be associated with closing out your current loan. If your bank has pre-payment penalties, you will need to factor those costs in to your costs at settlement.

Staying on Top of Your Mortgage

Variable rate mortgages often offer what the industry likes to call “honeymoon rates,” which are lower interest rates early in the loan life. These rates increase to larger interest rates down the road. If you decide to accept terms like this, be sure to keep an eye on your budget and make sure you’re prepared when the time comes for your rate to jump. Often these mortgages are structured to jump periodically, such as every 12 – 36 months. Some mortgages adjust upward with the market. Be sure you know what you’re getting into before you sign any mortgage documents.

It’s good to periodically test the market for better rates; especially if you have a good credit history or if you get additional debts paid off after securing your mortgage.

5 Vital Tips for Selling and Buying Real Estate in Todays Market

Successful buying and selling of property revolves around timing. Keep in mind that the longer your home is on the market, the less attractive it becomes to home buyers. Although you cannot control the market and other inevitable circumstances, you can nevertheless control other factors like pricing and marketing, which will definitely affect the probability of sale.

Here are 5 vital tips to remember in buying a new home and selling your current one.

Sell Your Current Home First

Unless circumstances dictate, you should sell your current home first before buying a new one. Otherwise, the wrong timing of the settlement of your new home may force you to sell your current home “at all costs” even if lower than market value. Also, under some market conditions, properties sell so quickly that sellers won’t accept offers and contracts that contain contingency clauses, i.e., that the purchase of your new home is subject to the sale of your current home. These conditions turn-off home sellers, and in dealing in the fast-paced property market, you will most likely miss out on the new home you’re eyeing.

Do Your Pricing Homework

Pricing can make or break the success of selling your home. An overpriced house will likely attract less prospective buyers, thus, delay the sale while an under priced house, although may draw a fast sale, will definitely result in loss of profits. There is no hard-and-fast rule in pricing a property. It’s actually a marriage of actual cost, sentimental value, and supply and demand.

Loan ShoppingSorrento Living Loan Shopping

Never jump at the first financial institution you come across with. Even if its offer may be tempting, you’ll never know if it’s the best financial institution for you or if its offered loan product is the most excellent without making a little loan shopping.

Approach several financial institutions and obtain information such as interest rates and other terms and conditions like loan period, fees and costs, down payments and private mortgage insurance. Compare such rates and terms of one lender from the other. In choosing a loan, pick one with conditions that best suit your situation. Negotiate for the best deal so that your loan should bear the lowest interest rate and settlement costs.

Coordinate Settlements to Minimize Expenses

As a seller of your current home and as a buyer of a new home at the same time, you take on dual roles that are opposite in the spectrum. One of these roles will likely be at a disadvantage since the property market could lean in favour of the seller and not the buyer, and vice versa. To protect the interest of your weaker role, you need to coordinate the settlements. Before putting your current house on the market and agreeing to buying a new house, it is a must to investigate the prices of the houses in both the communities where you’ll be buying and selling. You need to compare the prices since the idea is for you to sell your current home high and buy your new home low. With an estimation of the gap between the prices of both houses, you would be able to work on your finances including current loan repayments.

You can contact me to get an idea of the estimated price of your current home and prospect homes to buy within Perth. Should you choose us to help you with your buying and selling transactions, we could coordinate the settlements to minimize your expenses.

Home Improvements

In real estate sales, first impressions last. Selling a home is like entering a beauty contest – the best looking home gets the highest price and sells the fastest. So, before receiving prospective buyers into your home, make sure it is spotless and screams “buy me”.

In improving your home to make it more appealing to home buyers, preparation is the key. So begin by inspecting your home, and if you find some areas that needs some work on, have it completed before you start to market it. In preparing your home, details are absolutely vital. Why suffer the indignity and shock that your home doesn’t pass Building and Pest Inspections, and risk a contract falling over? Remember that a well-kept house is additional assurance to home buyers of your home’s quality, thus, also boost price.

If I can help any further with any of the above tips please feel free to contact me any time.