The RBA dropped the Cash Rate – what does that mean for my loan?

Many of us got a shock when the Reserve Bank of Australia met last week. After ten consecutive months of no movement the Reserve Bank dropped official cash rates by 0.25% to a historically low level of 1.75%.

We were then pleasantly surprised when some of our major Banks and lenders quickly announced that they would pass on the full 0.25% p.a. reduction to variable rate loans– albeit in most cases some weeks down the track.

So now a week later the question most borrowers are asking is – Did my lender drop their variable interest rates? If so, was it the by the full 0.25% p.a.?

Continue reading The RBA dropped the Cash Rate – what does that mean for my loan?

The “Bank of Mum & Dad”

There are many kids in Australia who have treated their parents as a ‘bank’ as they have grown up. Whether it was getting the newest game or latest technology before they had saved enough pocket money, or even as big as asking for assistance to buy a car in their late teens.

But these days with the cost of housing many kids are seeking much larger withdrawals and assistance from the ‘Bank of Mum & Dad’ to help them get into property ownership.

Continue reading The “Bank of Mum & Dad”

What is Lenders Mortgage Insurance (or LMI)?

Lenders Mortgage Insurance, commonly referred to as ‘LMI’, is an insurance that covers a Lender should a borrower default on their loan and the lender incurs a loss.

As a general rule LMI is payable on Home Loans where the loan to valuation ratio (LVR) is greater than 80% and allows borrowers purchasing property to potentially gain a loan at up to 95% of the purchase price of a home.

Continue reading What is Lenders Mortgage Insurance (or LMI)?

Applying for a Business Loan: What do Banks look for?

 

 

There is a saying that a banker is “someone who gives you an umbrella when it is sunny and takes it away when it is raining!”

I am sure many small businesses have felt this way when dealing with their bank or lender in gaining finance, or simply trying to maintain the finance agreements they already have.  Over the years I have witnessed and experienced the stress, frustration and at times dismay of business owners when a loan approval is not forthcoming or conditions of an approval have not been acceptable to the business owner. Continue reading Applying for a Business Loan: What do Banks look for?

What will I achieve with a “Loan Health Check”

 

Many professionals within the finance industry offer to provide a review of your current loans with terminology such as “Home Loan Health Check”, “Loan review”, or similar.

But what does this mean and what does it involve?

Continue reading What will I achieve with a “Loan Health Check”

Why use a Finance Broker?

Clip Art Pictures_003Finance Brokers (also often referred to as Mortgage Brokers, Mortgage Planners or Credit Advisers) act as an intermediary between lenders and borrowers to negotiate loan facilities.

Over the last 10 – 15 years the usage of Finance Brokers in Australia has increased consistently and it is now estimated that approximately 1 in every 2 new home loans in Australia is sourced through a Finance Broker.

So why do so many borrowers utilise a Broker rather than going to their local Bank? Some of the benefits and reasons include: Continue reading Why use a Finance Broker?