To our valued clients,

We know your lender will have contacted you in relation to support they can provide you during this COVID-19 crisis.  We want to reach out to you also to ensure you know that The Home Loan Company is here to support you too.  Australian’s have been deeply affected by the fall-out of the virus, creating much uncertainty.  We encourage you to make contact with your lender if you need financial assistance and so you understand what is available to you during this time.  Your lender can offer you options to reduce the impacts of COVID-19 as it relates to you, your family and your business.  This could be in the form of a deferral of loan repayments for a period of 3 to 6 months, considering a variation of loan repayments (i.e. converting principal and interest loans to interest only for a period of time) or a reduced rate of interest.

Here is a list of some of the lenders on our panel, their contact numbers and links to information to initiate a request for assistance.

ANZ call 1800 252 845 or follow this link ANZ
CBA call 13 30 95 or follow this link CBA
NAB call 1800 701 599 or follow this link NAB
Westpac call 1800 067 497 or follow this link Westpac
St George call 1300 303 110 or follow this StGeorge
Bank of Sydney call 13 95 00 or follow this link BankofSydney

Suncorp call 1800 225 223 or follow this link Suncorp

ING 1300 349 166 or follow this link ING

Bank of Queensland call 1300 55 72 72 or follow this link BOQ

Liberty call 13 11 33 or follow this link Liberty

Please note that due to overwhelming demand, wait times can be excessive if opting to speak to a bank/ banker so consider lodging a request via the lender website.

We have previously gone through a similar time during the GFC and we remain determined to overcome COVID-19 too.  There’s no denying this will a tough long road and if there’s anything we can do to help please reach out.

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There are very competitive home loan rates in the market for owner occupiers if you are prepared to choose principle and interest and this is a great time for you to consider a home loan health check.  I’m sure we can help you save $1000’s in home loan repayments.

But what about for investors?  You may recall on 31 March 2017 APRA sent a letter to all ADI’s to immediately take steps to reduce their exposure to new interest only residential mortgage lending to 30% (currently representing approx 40% of bank lending). An important component of investment lending is to utilise interest only (IO) repayments so generally this affects investors more.  IO is popular with investors for a few reasons including the assumption that the property is going to increase in value and create equity for their next property purchase, investors can maximise their cashflow and use the tax deductibility of interest on their investment loan repayments. IO may also offer the option for investors to prepay interest for the upcoming financial year, allowing them to claim next financial year’s benefits in the current one.

In the last month most lenders have increased their interest only rates on loans by around 0.3%.  In addition, if the purpose is for investment, many have an additional interest rate loading of 0.2% so it all adds up.  Some lenders will no longer offer you an interest only option on owner occupied properties and others have reduced how much you can borrow if interest only is required.

As for investment loans, the higher the loan balance and longer the IO period, the more an investor can maximise their tax-deductible benefit so your strategy shouldn’t change just because of the rate.  As we enter the new financial year, lenders may relax their focus on capping interest only appetites through rate hikes … that is until they head towards 30 June again and need to watch their loan book exposure all over again. The Home Loan Company can help you compare the best and most competitive investment home loans available for you.  Get in contact with us and we’ll help you achieve your strategy.

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So don’t set and forget… that just costs you money.  Let’s have a look at your mortgage and see what it’s doing for you.  No obligation and it’s easy to do. Don’t miss out on the opportunity while you can.

The post Don’t miss out – Save Money on your Home Loan appeared first on Home Loan Company.

Property Investor? Do you know how to structure your new or existing finance so you have control over your assets?

Many property investors believe that their loans are stand-alone and secured by just one of their properties when in fact their loans are secured or cross collateralised with their other properties.

For example; you want to borrow 105% of a property’s purchase price to complete the purchase including costs.  Many lenders (or brokers) will offer multiple properties in your portfolio as security for your next purchase. This is called “cross-collateralisation”.  As an investor in the majority of situations there is little benefit to you.  Just a few of the reasons: the inability to revalue your properties individually to access your equity.  Often one property can be valued up and the other down and as they are linked, your net gains may be neutralized as they offset each other.  You may also not be able to access your funds when you sell a property.  It can also be difficult to change products, lenders and you may have unnecessary fees to pay.

As an investor these considerations are important and need to align with your objectives.  We can help you with this.  So before you buy, talk to us.

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“At its meeting today, the Board decided to leave the cash rate unchanged at 1.50 per cent.

The global economy is continuing to grow, at a lower than average pace. Several advanced economies have recorded improved conditions over the past year, but conditions have become more difficult for a number of emerging market economies. Actions by Chinese policymakers have been supporting growth, but the underlying pace of China’s growth appears to be moderating.

Commodity prices are above recent lows, but this follows very substantial declines over the past couple of years. Australia’s terms of trade remain much lower than they had been in recent years.

Financial markets have continued to function effectively. Funding costs for high-quality borrowers remain low and, globally, monetary policy remains remarkably accommodative.

In Australia, recent data suggest that overall growth is continuing, despite a very large decline in business investment, helped by growth in other areas of domestic demand and exports. Labour market indicators continue to be somewhat mixed, but suggest continued expansion in employment in the near term.

Inflation remains quite low. Given very subdued growth in labour costs and very low cost pressures elsewhere in the world, this is expected to remain the case for some time.

Low interest rates have been supporting domestic demand and the lower exchange rate since 2013 is helping the traded sector. Financial institutions are in a position to lend for worthwhile purposes. These factors are all assisting the economy to make the necessary economic adjustments, though an appreciating exchange rate could complicate this.

Supervisory measures have strengthened lending standards in the housing market. Separately, a number of lenders are also taking a more cautious attitude to lending in certain segments. The best available information suggests that dwelling prices overall have risen moderately over the past year and growth in lending for housing purposes has slowed. Considerable supply of apartments is scheduled to come on stream over the next couple of years, particularly in the eastern capital cities.

Taking account of the available information, and having eased monetary policy at its May and August meetings, the Board judged that holding the stance of policy unchanged at this meeting would be consistent with sustainable growth in the economy and achieving the inflation target over time.”

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A good article from the MFAA on when and why to refinance.

The most common reason for people to refinance their mortgage is to get a better deal and lower rate. But be careful you don’t become interest rate-fixated.  Your mortgage needs to have the flexibility to do what you need which often isn’t possible with low rate basic home loans eg redraw, offsetting interest without hefty fees for doing so.

Home Equity: When property prices increase in value at a significant rate. e.g. a home you bought for $600,000 five years ago, might now be worth $800,000. Refinancing your mortgage and tapping into that extra $200,000 equity can help you purchase an investment property and help you build wealth.

So let’s have a look at your mortgage and see what it’s doing for you!

http://www.mortgageandfinancehelp.com.au/re-financing/when-would-i-refinance-my-mortgage/

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Offset accounts and redraw facilities work in similar ways as they both allow you to reduce the balance of your home loan therefore reducing the interest charged by applying extra money to your debt.
Deciding between an offset account and a redraw facility on your home loan largely depends on how accessible you need your extra money to be. This is something we help our clients navigate.

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Exit and early termination fees on your mortgage can put the brakes on your plans to sell, to refinance, and to renovate or purchase an investment property.
Consider your future goals. Do you have plans to move city or change your job? Are there any foreseeable disruptions to your financial circumstance likely to take place during the space of your fixed-term rate?
To avoid being caught out by fees and charges, speak to me first.

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At its meeting today, the Board decided to lower the cash rate by 25 basis points to 2.5% effective 7 August 2013. To see the full commentary follow this link

Now is a good time to review your home loan. The Home Loan Company can compare your mortgage against what is available in the market. Let us know if you would like a complimentary review.

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