Saving a 20% deposit for your first home is no easy task – particularly if you want to buy your home in Melbourne or Sydney where home values seem to be rising faster than most people can save. But the good news is that there could be ways to get around the problem. Here’s a few little-known strategies and suggestions from your friendly mortgage broker that could potentially help you secure your first home sooner. We hope you find them handy!
Buy what you can afford right nowAs a first-time buyer, it’s important to know what you can afford to purchase right now. Why wait when you could opt for a cheaper entry point into the market and work your way up the property ladder? As your mortgage broker, we’re here to help you work out your current borrowing capacity, so it’s worth getting in touch.

Borrow up to 95% with Lenders’ Mortgage Insurance

Did you know you may not need a 20% deposit to buy a property? Under some circumstances, you may be able to qualify for a loan for 95% of the purchase price. You would have to pay Lenders’ Mortgage Insurance and strict eligibility criteria will apply, but if it allows you to achieve the dream of homeownership sooner, it may be worth it. Talk to us – we’ll explain whether this option could work for you.

Borrow up to 100% with a Guarantor Loan

A guarantor is someone who will provide a guarantee for your home loan, usually a family member (better known as the ‘bank of mum and dad’). This guarantee is usually secured against the equity in their own property. Once you have paid off part of your home loan, or your property has increased in value, you can apply to have the guarantee removed.

Guarantor Loans are a great idea for first home buyers who do not have a full 20% deposit as they save you from having to pay Lenders’ Mortgage Insurance. Some lenders even allow you to consolidate some of your debts – such as credit cards – when you buy your home. Talk to us if you’d like to find out more.

Delay paying your deposit 

If you can’t come up with the cash deposit for your home right now, you may be able to use a deposit guarantee. This is a type of insurance that guarantees the funds will be paid upon settlement. Your money may be tied up in a fixed-term deposit or other assets that you’re waiting to sell. Maybe you’ll be eligible to receive the First Home Owners’ Grant after settlement, but you’d like to use the money from the grant as part of your deposit? A deposit guarantee could help! Talk to us to find out if this strategy could work for you.

Use your super to save your deposit

If you’re trying to save a deposit for your first home, you may be able to use your super to help you save faster. Earlier this year, the Government announced plans to introduce a new scheme that, from July 1, 2018, will allow first home buyers to withdraw any voluntary contributions you make to your super after July 1, 2017. You can potentially withdraw up to $30,000 of voluntary contributions, plus any associated deemed earnings, and put the money towards your deposit. The amount withdrawn will be taxed at marginal rates, less a 30 per cent offset – which means the government will effectively be helping you save your deposit! If you’re a couple, you can both withdraw that $30,000 amount, so it could provide you with a significant deposit for your first home.

But before you start whacking your extra money into your super, be sure to ask your financial planner, accountant, or super provider whether or not you could benefit from this new scheme. As yet, the full terms and conditions of the scheme have not been published, but you can find out more here.

Have someone with experience on your team!

Our final suggestion is to have someone in your corner who knows the game and how to play it. As your mortgage broker, we’ll do everything we can to help you secure finance for your first home. We know all the lender requirements for every loan and can help keep the application process simple, so please get in touch and have a chat with us about your property purchasing plans and financial goals. We’ll also be here to support you after you make your first home purchase – our long term goal is to help you build wealth for your future through property – so rest assured you’ll always be in safe hands with us as your credit and finance partner!6 little-known strategies for first home buyers

There’s a certain buzz in the air at this time of year, as the weather warms up and the property market gets into full swing. Buyers continue to come out of hibernation and snap up properties during the spring selling season. If you’re one of the lucky ones about to make an exciting property purchase, we’d love to help you find a home or investment loan that suits your financial circumstances and goals. Please get in touch!
Interest Rate News

This month, the Reserve Bank of Australia kept the official cash rate unchanged at 1.5%. The RBA’s decision to hold the cash rate was widely anticipated by economists. In September, some of the major banks lowered interest rates on fixed rate loans, so it could be a good time to speak to us to see if this option works for you. Overall, interest rates remain low and there are some very competitive products out there, so call us if you’d like us to check your home loan features and rate!

Property Market News

Dwelling values increased in all capital cities except Sydney and Darwin last month. Hobart led the way, with a month-on-month change in dwelling values of 1.71%. In Melbourne, values rose 0.86%, while in Canberra they were up 0.56%. Brisbane saw increases of 0.28%, and Perth experienced 0.08% growth. Adelaide was slower, with an increase of 0.03%. In Sydney, home values decreased by 0.13% and in Darwin they fell 0.68%.

While auction activity was strong earlier in September, it dropped off during the final week of September (week ending October 1). In Victoria, there were only 137 scheduled auctions, with 89% of properties selling, while in New South Wales, 690 auctions were held and only 67% of properties sold. That’s a big drop in volume compared to the previous week (ending September 24), when both states had a combined 2,672 properties go to auction and clearance rates of 74% for Victoria and 70% for New South Wales. Perhaps everyone was just too busy watching the footy Grand Finals!

In South Australia, 78% of the 45 properties scheduled for auction went under the hammer in the week ending October 1. The ACT held 45 scheduled auctions and achieved a clearance rate of 76%. Western Australia had 17 scheduled auctions (67% clearance rate) and Queensland had 306 scheduled auctions, with a 39% clearance rate. The Northern Territory had 6 scheduled auctions (25% clearance rate), while Tasmania only had one property go to auction, and it sold!

Spring is traditionally the most popular time of year for vendors to sell, and with more competition out there, you may score an attractive deal on the property of your dreams! So please give us a call to talk about your spring property plans, we’re here to help you find you a mortgage that is tailored to suit your financial circumstances and goals, and we’d love to help!Welcome to our October Newsletter

The clever investor knows that assessing your investments regularly is key to identifying opportunities to build wealth. Knowing when to refinance an investment property could be vital to a successful strategy. So is now the time for you to refinance?

Talk to us and we’ll help you to decide! Despite recent tightening around investor lending, there are still some very competitive interest rates available from a variety of lenders. In this article, we cover some of the common questions we get from our property investor customers – and if you do decide you’re ready to refinance, you can rely on us to make it easy!

Why should I refinance my investment property?

There are generally two main reasons why you may want to refinance your investment property. These are to access your equity, or to change to a different loan.

If you’d like to expand your investment portfolio, refinancing to access your equity could be a good move. You could potentially use your equity as a deposit to buy another property, or to take advantage of some other kind of investment opportunity – talk to your financial planner to see what strategy is right for you.

Accessing your equity to renovate could also be a good move. It could help you add value to your investment property, fast-track its capital growth and perhaps improve the rental value to increase cash-flow.

What kinds of fees are involved?

The good news is that when you refinance an investment property, the costs involved in exiting your existing loan and setting up another are usually tax-deductable. That includes the borrowing expenses and any exit fees or penalties. In the first five years of owning your investment property, you can usually claim borrowing expenses back incrementally, and if you refinance within that timeframe, you can claim the remaining tax deductions immediately. Talk to your tax accountant about the benefits appropriate to your situation. If you don’t have one, we’ll be happy to help you with a referral.

Should I use one lender or multiple lenders?

Professional investors often prefer to use multiple lenders to avoid cross-collateralisation. Cross-collateralisation is where you secure a loan against two or more properties instead of one – which can be inconvenient when the time comes to sell, and risky if property prices should fall. If you use one lender, your properties may be cross-collateralised by default. Having said that, some investors may prefer to use one lender. Overall, it depends on your individual financial situation, goals and the size of your investment portfolio, whether you may choose to go with one lender or several. Talk to us and we’ll help you decide which loan structure is right for you.

Should I refinance all my investments at the same time?

If you’re reviewing one mortgage, you might as well ask us to assess all of your investment loans to make sure they are up to scratch. You may decide you are happy with the deal you are receiving for some of the loans, and only proceed with refinancing others. Or you may decide it’s time to change the way all your loans are structured and if so, we’re here to help.

Talking to your financial planner or tax accountant is also a good idea, to make sure refinancing is the right strategy for you financially. If you’d like to chat or explore the kinds of investment loan options out there, please get in touch today. We’d love to help you find the right finance to fulfill your needs!Investment property refinance made easy!

In Australia, the national past-time seems to be to save, save, save for a house deposit! People are making all sorts of sacrifices to get that all-important deposit together – from living with mum and dad into their thirties, to sacrificing life’s little luxuries. But why are so many Australians so very focused on owning their own property?

Besides providing a cosy nest of your very own, buying a property can potentially open up a world of wealth building opportunities – for your long term benefit! Whether you’re buying your own home or an investment property, home ownership could be a good move to help you get ahead financially. So get ready to start feathering your nest! Here’s a few reasons why real estate can be used as a powerful wealth generator.

Capital growth potential

Real estate has real potential to increase in value over time – this is called capital growth. That’s because the supply of housing is often insufficient to meet demand, supporting growth in values.

Whether you’re buying your home to live in yourself, or you’re buying a property as an investment to rent out to tenants, capital growth is going to be very beneficial to your financial situation. If the value of your property increases, you could potentially make a nice profit when you sell, particularly if it’s your own home. Alternatively, you could access the capital gains (known as equity) as you go along by refinancing your loan – effectively using the property as a money tree.

Make more investments

Money tree you say! We all know that money doesn’t grow on trees, so how does that work?

If you refinance your home loan you can access your equity, which gives you funds that you can spend how you like. If you’re focused on building wealth, you may wish to use it as a deposit for an investment property. Once some time passes and your equity builds in that property too, you could refinance your loan again and use those funds as a deposit for your next investment, and so on. In this way, your nest egg could potentially keep growing and growing.

This is just a broad outline of how property investment works. We recommend that you talk to a professional financial planner to help you formulate an investment strategy that’s right for you. Just ask us if you’d like a recommendation.

Tax perks

As mortgage brokers, we’re not tax advisors or financial planners. But generally speaking, property investment is a very popular form of investment, mainly because the Australian Taxation Office supports it with tax benefits.

One popular strategy is to ‘negatively gear’ your investment property to reduce your taxable income. Negative gearing is when the expenses associated with owning the property (including interest on the loan borrowed to finance the property) are greater than the income it generates. You can claim any net losses against your taxable income and in this way, reduce the tax you’ll have to pay on the money you earn in your job or by other means – all whilst your property investment makes capital gains. Once again, talk to your accountant and financial planner to be sure that a negative gearing strategy is right for you.

Speak with us about your property plans!

Buying real estate could be a smart move for you financially, whether you’re buying a home to live in or are investing in property to rent out to tenants. We’re here to help you maximise your financial position and obtain a loan that’s suitable for your purposes and goals. Talk to us about how buying a property could benefit you – we’ll help you to determine your borrowing capacity, get pre-approval on your loan and can even help you with insightful property data to assist you with locating and purchasing the right place. Just give us a call and we’ll be happy to chat with you about your plans.3 ways to start growing your nest-egg using real estate.

Spring has sprung and isn’t it a glorious time of year? It’s traditionally the time for change and new beginnings! If you’ve been considering a property purchase, now could be the time to get out there, enjoy the sunshine and start your property hunt.
Perhaps you’ve been considering refinancing to a fresh new mortgage that’s tailored specifically to your needs? Or perhaps you’re thinking of renovating your existing home? If so, we’d love to help you out. As the property market heats up, we are seeing plenty of competitive lender deals, so be sure to speak to us about your loan options before you start on your spring property plans!

Interest Rate News

This month, the Reserve Bank of Australia decided to keep the official cash rate on hold at 1.5%. Lenders continue to cut rates for owner-occupiers on principal and interest home loans, and at the same time, try to ensure the proportion of their loan books for investment purposes and interest-only loans meet APRA’s lending guidelines. Despite these restrictions, some lenders have cut interest rates for investors on principal and interest loans in recent weeks. Overall, interest rates remain low and there are competitive deals for both home owners and property investors.

Property Market News

Last month, dwelling values increased by 0.11% overall across the combined capital cities. Sydney’s growth was flat during August, while Hobart led the way for growth in dwelling values, at 0.61%. Hobart was also the strongest capital city performer for the past 12 months (13.61% growth). Canberra experienced 0.57% growth in August, while Melbourne remained resilient, with property values increasing 0.54%. Brisbane and the Gold Coast saw an increase of 0.18% for the month, and in Adelaide property values edged 0.03% higher. Perth’s dwelling values slipped -0.83%, while in Darwin they fell -2.17%.

Auction volumes remained high in Victoria and New South Wales, with 1987 combined scheduled auctions in the week ending September 3. Both had relatively strong clearance rates of 73% and 70% respectively. Across the other auction markets, clearance rates were varied. Tasmania had 10 scheduled auctions, with an impressive 100% clearance rate. The ACT had a 68% clearance rate for 69 scheduled auctions, while South Australia’s clearance rate was 62% for 80 scheduled auctions. In Western Australia, 28 properties went to auction, but only 58% sold, while in Queensland there were 292 scheduled auctions, with a clearance rate of 36%.

If you have property plans this spring, talk to us about a competitive home loan, investment loan, or renovation loan that works to your advantage. We’ll compare the market and line you up with a mortgage that ties in with your personal financial circumstances and goals. Please get in touch today – we’d love to help!Welcome to our September Newsletter


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