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What is a mortgage offset account?
What is it?
An offset account is a transaction account that can be linked to your home or investment loan. The credit balance of your transaction account is offset daily against your outstanding loan balance, reducing the interest payable on that loan.
Offset accounts enable you to make the most of your income and other funds to reduce the interest payable on your home loan, thereby reducing your loan term.
How an offset account can work for you
A customer with a $ 150,000 home loan over 30 years would pay approximately $ 167,190 in interest.
If the customer had an offset account linked to the home loan for the entire loan term with a constant balance of $ 10,000 in it, they would pay the loan off in 26 years and 4 months and pay just approximately $ 127,553 in interest.
This represents a saving of three years and eight months and approximately $ 38,636.95 in interest.
Please note: These figures are based on a Standard Variable Rate of 7.36% p.a.
Here at The Home Loan Advisory we not only assist our clients with finding the right loan for their situation, but our post settlement service is second to none. Post settlement we meet with our clients and show them how to correctly set up their banks accounts and how to link them the right way with their loan accounts. We guarantee that we show our clients how to save a minimum of $ 160,700 in interest expenses over the term of the loan *…
Click the consulation button to your right and ask us which lender is offering the best deal! (We have access to all the major banks and many other leading lenders)
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Investors must look beyond rates
Investors should be looking beyond the interest rate and putting loan features, fees and their financial objectives higher up the priority list, according to a Australia’s largest independently-operated mortgage broker.
Planning ahead and keeping the future in sight is important for investors that are getting caught up with interest rates, said Mortgage spokesperson Belinda Williamson.
“With much attention placed on lenders’ home loan interest rates, it is easy to lose sight of the bigger picture and to neglect to factor in other loan aspects that may offer longer-term benefits to borrowers than a loan with simply the lowest interest rate,” Ms Williamson said.
“Investors should do their finances a favour by choosing a home loan on more than interest rate alone.
“A loan’s features, such as an offset account or redraw facility, associated fees, and whether you choose a fixed, variable or split interest rate will have an effect on how much you will pay in overall interest and how long it could take to repay the loan,” she said.
Additional features that give investors the flexibility to continue borrowing are an important part of financing a property portfolio.
“When looking to make multiple property purchases, the flexibility of a loan product can be more important than its interest rate,” Resi Home Loans chief executive Lisa Montgomery told Smart Property Investment.
“The flexibility of a product is the key to leveraging for that next property,” Ms Montgomery said.
Source: spionline.com.au by James Mitchell 29th Feb 2012
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February interest rate cut on the cards
It now seems all but certain that the Reserve Bank will cut interest rates next month, with AMP’s senior economist Bob Cunneen predicting the cash rate will drop to 4.0 per cent.
According to Mr Cunneen, the latest retail spending data suggests the Australian economy is flatlining, which should encourage the Reserve Bank to look at rates.
Data from the Australian Bureau of Statistics found retail sales were flat in November – below the market expectation for 0.4 per cent growth.
In year-ended terms, retail sales rose 3.1 per cent, which is well below the long run average of 5.6 per cent year on year.
But while some borrowers will be happy to hear interest rates are still on a downwards trend, RP Data’s Cameron Kusher said interest rate cuts shouldn’t necessarily be seen as “good news”.
“Rate cuts are great for those with a mortgage, because it makes your repayments cheaper. That said, rate cuts also mean that the economy isn’t doing so well.
“For people that want to jump into the market it is going to be harder. They will have to have more savings because the LVR on loans will be lower. And, I don’t think we will see the reintroduction of the First Buyers Grant Boost.”
Source: Jessica Darnbrough, theadviser.com.au
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$ 300 Gift To You
$ 300 Gift to our clients, and loyal readers …
For a lot of people a New Year resolution is to get their finance under control and build their wealth….
We are offering all our readers a loan review. The home loan market is very competitive at the moment and there are some excellent deals available right now. Many of them are not advertised and we have access to some very special deals…
Often we save our clients around $ 300 or more per month in repayments… simply re-financing and re-structuring their finances …
To take part of this great offer, all you have to do is contact us to set up a home loan review to see how much you can save every month…
Once you engage our service we’ll pay for your Lender Exit Fees up to $ 300. Most lenders should be around $ 250… (Either way we’ll make it $ 300… e.g. Discharge fee $ 250 plus $ 50 Westfield Gift Voucher).
If you are a new client and looking to buy a property we will give you a Westfield Gift Voucher for $ 300 (if you are not refinancing).
Click here to contact us and take up this offer and we will be in touch shortly.
Don’t have a home loan or need one… You can still claim your $ 300 Gift! Simply refer one of your friends that need a home loan, we’ll give them the same offer and give a $ 300 gift voucher as well
… This offer is open until the 31st of January 2012. This offer applies to any person that engages our service and settles a loan with us.
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What are Genuine Savings? Get approved today
Genuine Savings For A Home Loan Deposit Explained
Just when you thought that you could get the best home loan deal by simply having a lump sum of cash, you might have to think again. Not all cash deposits are acceptable in applying for a home or investment loan when your deposit is less than 20% of the purchase price.
These days you can obtain a home loan with as little as a 5% deposit. That means a bank can lend you up to 95% of the purchase price.
If you are considering applying for a home loan with a deposit that is less than 20% of the purchase price then here are some of the things that you need to know. At least 5% of your deposit needs to be made up of genuine savings.
1. What exactly are genuine savings?
These are savings that are held or accumulated in a savings account for at least three months.
2. What other assets might be considered as genuine savings?
Other assets that can be considered as genuine savings are term deposits, shares, and equity in property that are held for at least three months.
If you have any debts, e.g. a personal loan, and you have been paying extra off your debt above the minimum requirement, you can use this extra repayment towards your genuine savings calculation.
If you are currently renting for 12 months or more through a Real Estate agent, you may be able to use those rent payments towards your genuine savings calculation as well. Please contact us to discuss your personal circumstances to see if you qualify.
3. What does not qualify as genuine savings?
Gifts from parents
Tax refunds
Income Bonuses
Inheritance money
Cash kept at home
The First Home Buyers Grant
If any of these apply, we recommend that you place those funds into a personal savings account and hold them there for three months to qualify.
4. How much do I need for a home loan deposit?
You can obtain a home loan with as little as a 5% deposit. The major lenders may provide a mortgage up to 95% of the value of the property. In some instances you may be able to borrow the whole amount, contact us to see if you qualify.
5. Can I buy a property if I don’t have genuine savings?
We have access to lenders where you can borrow up to 95% of the purchase price without having genuine savings. Of course you still need to come up with at least a 5% deposit plus funds to complete (stamp duty, legal costs etc). Contact The Home Loan Advisory today on 02 9965 7292 or click the consult button on your right and our home loan specialists will answer all your questions and assist you with finding the right home loan for your situation.
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Looking for the right home loan? If we can’t help you, we’ll pay you $ 500.00 for your time!
Special offer! Limited time: From 1st December until the 10th December 2011.
Looking for a home loan?
If we can’t find you the right home loan and get you approved, we’ll pay you $ 500.00 for your time!
Of course, as mortgage brokers we will not only recommend the right home loan from over 25 major lenders (including the banks), but we’ll take care of the the paperwork, running around, and manage everything to settlement. After settlement we’ll show you how to set up all your accounts, how to link them correctly to ensure you’ll save a bucket load of interest repayments…
Do you have a current home loan?
If we can’t improve your current financial position we’ll pay you $ 500.00 for your time!
What are you waiting for? You have everything to gain and nothing to lose! We’ll get you the right home loan and show you how to become debt free sooner!
Simply click on the Initial Financial Consultation button on the right, complete your details and we’ll be in touch shortly to book in a time to chat.
We look forward to helping you.
Regards,
Andrew Krauksts
Director
The Home Loan Advisory
02 9965 7292
andrew@thehomeloanadvisory.com.auTerms & Conditions apply – Applicant must meet minimum application credit criteria with The Home Loan Advisory lender panel. Application to improve financial position is based on applicant having a current home loan whereby repayments are up to date, no arrears for the past 12 month, they meet minimum application credit criteria with The Home Loan Advisory lender panel and they are on an Australian bank’s standard variable rate. Applicants must complete a Client Questionnaire prior to meeting to enable the broker to research the home loan market. Applicant must agree to a face-to-face 1 hour meeting to present recommendation and solution. The Applicant is in no way obligated to proceed with any recommendation presented. This is a Free service for the Applicant.
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First homebuyers’ cheat sheet: 10 tips to buying your first home
So you’re going to take the plunge into real estate ownership. Congratulations! You’ve just made a smart decision in securing your financial future.
Let me help you with my top 10 tips for buying your first home.
1. Decide what you can afford
Take a look at your salary, debt levels, cost of living and the repayments you’d face on your ideal property. Be honest with yourself about lifestyle costs so you don’t over-stretch yourself. Remember, you have the First Home Owners’ Grant of $ 7000 available to you; and if you buy in NSW before 1 January 2012, you can still enjoy the full stamp duty exemption of $ 17,990 on a property worth $ 500,000.
2. Get your finance pre-approved
Do this before you start looking. Don’t risk missing out on a great property because you haven’t got your finance organised. Shop around too as the banks are offering some very competitive rates right now!
3. How to buy where you want for less
Take a look at the neighbouring suburb. It might be a five-minute walk away but often so much cheaper. If you can’t afford your favourite area, consider what you like about it and seek the same in another region. Say you love the café culture and CBD proximity of Sydney’s Eastern Suburbs. You’ll find the same attributes in the more affordable Inner West.
4. Top features to look for
Major items to look for include a quiet suburban location away from major roads and traffic noise, lots of natural light, close proximity to shops and transport, a good floor plan, good internal size (apartments)/land size (houses) and ideally, off-street parking. Your first property purchase will not be your last, so be willing to compromise on the smaller things but not the headline items above.
5. Properties to avoid
Company title apartments often have by-laws restricting owners’ rights to rent their apartments. This might not matter right now, but if you ever want to rent it out or sell it later, company title could be problematic. Stick with strata apartments – there’s plenty around. Also avoid new apartments in inferior locations. They’re often keenly priced because the developer bought the site cheaply.
6. Recognising potential
It’s really off-putting to walk into a dirty, untidy property. But stop yourself and try to see past the mess. How would it look with new paint and carpet and a professional clean? A poorly presented property in a good location is a gift for budget-conscious buyers as you’ll face less competition.
7. Buying at auction
You can make an offer prior but you risk paying more than you need to. Pre-sales usually occur when there is lacking interest or when one buyer is offering a lot more. Plan your walk-away price and attend some auctions to experience the atmosphere and observe a few bidding strategies. Organise contract amendments beforehand in writing. If you really don’t want to bid yourself, you can authorise someone else to act on your behalf.
8. Bidding at auction
If you’re going to start the bidding, start low. Project confidence and make the other bidders think you have no limit. Make your bids fast and assertive. Agonising over your next bid is a sign of weakness. Call out your offer in full (that is, say “$ 350,000” instead of the increments, such as “$ 5000”). If it’s going to pass in, make sure you’re the highest bidder as you’ll usually be given first right to negotiate afterwards. Stick to your walk-away price. Short-term disappointment beats long-term remorse!
9. Buying via private treaty
Don’t offer the most you can first-up, as vendors will always assume you can do better. Put the offer in writing and mention your pre-approved finance. To make it more seductive, sign a contract and attach a deposit cheque. If it’s rejected, look for ways to help the vendor. Offer a shorter settlement or early release of the deposit if they accept the price. After one or two rejected offers, try offering an odd number such as $ 337,500 instead of $ 340,000, as it implies you’re stretched to your financial limit.
10. Get a pest and building report
I strongly recommend this but there are also ways to identify major defects yourself. These include checking the power board in the electricity box to see how old it is; checking for sagging floors; and looking for water stains on the ceilings or dark stains around the skirting boards, which could indicate leaks or rising damp. Also, turn on a tap to check the water pressure.
Finally, if you’re a NSW first homebuyer trying to buy before 1 January so you can save that $ 17,990 in stamp duty, keep that number very firmly in mind. Don’t go $ 25,000 over budget in order to save $ 17,990!
Good luck!
Source: John McGrath – Switzer Published: Wednesday, November 16, 2011
Great advice from a leading real estate agent. It is really important to understand the cost involved in buying a home. We are offering you a free assessment which will provide you with a finance recommendation (comparing all the major banks and other leading lenders) and a total cost analysis to ensure you know all the ins and outs when buying.
Click on the consult button to the right and request a chat today!
Best regards,
Andrew -
Refer & Earn! Learn how to earn over $ 500 with one simple email
If any of your friends are looking for a home loan, refinance, consolidation of debt, etc, refer & earn!
Rather them attending the bank themselves, send them to us, we’ll take care of all the running around for them (at no cost), do their loan application, assess it to make sure it gets approved, lodge it with their lender and do all the chasing around until their loan is approved and settled.
If they are unsure where the best deal is, we’ll help them find the right loan. We are accredited with all the major banks and over twenty other leading lenders.
Refer and Earn, can be on a casual basis if you want to top up your income or train with me where I teach you how to earn an income stream.
How much can you earn?
It’s really up to you, and the true beauty about this program is that you can earn a significant amount of money simply by working from home.
Refer your family, friends, work mates, strike alliances with accountants/real estate agents/financial planners etc … Anyone really … Refer them to us, we arrange a home loan for them, the loan settles and we’ll pay you…
We’ll put a signed referral agreement in place to ensure your safety and payment.
Here are some samples of how much you can earn:
These examples are based on the total loan size you refer. For example, if you refer someone and we arrange a refinance of their existing home loan and a new investment loan with a combined home loan value of $ 800,000 we’ll pay you a commission of $ 500.
All you have to do is give us their full name, mobile number, email and ensure they have agreed for us to call them. Once their loan settles, you get paid!
Here is a breakdown of commission you can earn for each client you refer:
$ 150k & over = $ 100
$ 250K & over = $ 200
$ 500k & over = $ 350
$ 750K & over = $ 500
How do you get started?
Simply click the contact tab above and complete the form. In the comments section simply write – Refer and Earn!
I will contact you to have a quick chat, answer any of your questions, and you can start referring and earning!
Or, simply email me at andrew@thehomeloanadvisory.com.au with a referral and earn! It’s that easy.
I look forward to hearing from you.
Sincerely,
Andrew -
First home buyers eye NSW unit market
First home buyers continue to flood the New South Wales property market, looking to take advantage of the soon to expire stamp duty concessions, new research has found.
In NSW, first home buyers currently receive a stamp duty exemption for property purchases under $ 500,000, with discounts calculated on a sliding scale between $ 500,000 and $ 600,000.
But from January 1, 2012, the stamp duty concessions will apply to new homes only.
George Kambouroglou, principal of Raine and Horne Rockdale, in Sydney’s southern suburbs, said recently that first home buyer enquiries are up 20 per cent, with a strong focus on the unit market.
“Anecdotally it appears many first timers are now rushing to buy a home, before they lose access to thousands of dollars in government assistance at the end of 2011,” Mr Kambouroglou said.
“We’ve already sold six apartments to first home buyers including a two bedroom apartment at 13/33 Burrows Street, Arncliffe, which sold for $ 470,000 in late September 2011.
“Both apartments were in similar condition and 13/33 Burrows Street was snapped up by literally the first person to visit it at the initial open for inspection.”
Data from Loan Market Group released late last month supports Mr Kambouroglou’s comments, with the company reporting a 60 per cent increase in the number of first home buyer enquires in September.
Moreover, 76 per cent of brokers outside of Loan Market are reporting similar results.
“The increase in activity around pre-approvals is a clear indication that parts of the NSW property market are due for increased competition,” Loan Market chief operating officer Dean Rushton said.
“What we’re starting to see in the NSW market right now is a similar scenario to the end of 2009 when the government withdrew the increased First Home Owners Grant. Market demand has been pulled forward and buyers are accelerating their purchasing plans.”
Source: theadviser.com.au
Looking to buy your first home? Don’t know where to start? Not sure if you qualify? Contact us today for a free no obligation chat and find out how you can own your own home!
Andrew Krauksts
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Property auction activity is low
The long weekend did little to stimulate buyer activity in Sydney, with just 56.9 per cent of properties clearing at auction.
The most expensive property to go under the hammer in the capital city was a $ 1.7 million, three bedroom house in Malabar, while the most affordable property sold was a studio in Darlinghurst, which went for $ 300,000.
The story in Melbourne was much the same with 44.4 per cent of properties clearing at auction.
This is a far cry from the 68.5 per cent achieved this time last year.
Even more disappointing was the number of properties listed for auction.
According to the Real Estate Institute of Victoria, just 47 properties were listed for auction, in comparison to the 696 properties listed this time last year.
The lack of auction activity in Melbourne did not come as a surprise given that it was the AFL grand final.
Source: theadviser.com.au
How To Find The Best Rate And Save $160,700 In Interest* Off Your Home Loan ... guaranteed!
Home Loan Advisory
