If you’ve been putting all your extra cash into your home loan, well done. Paying your loan off sooner could potentially save you a lot of money on interest. However, owning a safe and reliable car is just as important, particularly if you have a family or need to travel a distance to work. So if you need a new car, how can you afford it if your home loan has been your priority? Is there a way to get the best of both worlds? The answer is yes!

How does it work?

If the equity in your home has grown significantly because you have been paying off your loan for a while, have made extra repayments, or the value of your home has increased, then you may be in a position to refinance your home loan to access your equity. This could give you enough cash to go down to a dealership and buy that new car. Having cash-in-hand may even give you a little extra bargaining power!

Whilst refinancing may mean that your home loan repayments increase somewhat, the increase could potentially be less than the cost of a car loan repayment and your mortgage repayment combined. Car loans and personal loans tend to carry a much higher interest rate than your mortgage. Depending on where you get your car or personal loan, you could pay anything from 6.5% p.a. up to 14.5% p.a. in interest. (Always talk to us before taking out any kind of loan to be sure you’re getting a suitable loan for your needs at a competitive rate.)

Talk to us and we’ll help you to assess your financial position on your loan to see if it is the right move for you.

What are the drawbacks?

It’s important to be aware that if you take some equity out of your home loan, your home loan repayments are likely to increase. You probably won’t be paying as much as you would if you had a separate car loan and a home loan as well, but if you take the full 30-year term to pay it off, it may cost you more in interest over the life of the loan. So if you decide to access your equity to buy a car, we recommend that you make additional repayments and pay it back as quickly as you can. This will help you to maximize the benefit of the lower interest rate you get by using your mortgage rather than a car or personal loan.

Talk to us first

Before you make any large purchase that may require a loan, it’s important to talk to us about your finance options so we can help you find a solution that’s right for you. We’ll help you decide whether refinancing and using your equity to buy what you need is a viable option, or if another type of finance could be more suitable. And above all, remember that car dealerships only offer one type of finance, whereas we offer a variety of finance options that can be tailored to suit your personal financial circumstances and goals – so always talk to us first. We’re here to help you achieve your financial goals, so call us today.Could the equity in your house buy you a new car?

If you’re a first-time buyer and new to inspecting properties, it can be difficult to know what to look out for, especially when you’re excited about your first home purchase!

Well, first-timers, we’ve got you covered. In this article, we’ve put together a 101 guide of things to be mindful of during your home inspections – all the big issues which may be costly to fix down the track. When you do find a property that ticks your boxes, you’ll want to be ready to move fast, so remember to talk to us about getting pre-approval on your home loan before you start inspecting. But first, here’s our checklist to help you avoid buying a lemon!

It’s all about your budget

If you’re a first time buyer and looking for a home, you’ll probably be inspecting properties that need money spent on them for a variety of different reasons. This checklist is designed to help you inspect properties effectively so you can rule out the lemons and save money on multiple building and pest inspections. But remember, it won’t rule out the need for a professional inspection on the place you decide to buy!

Structural issues: These are generally the most expensive and difficult problems to repair. During the inspection, keep your eyes peeled for signs of subsidence, uneven floors, cracks in the walls or brickwork, or doors that don’t close properly.

Plumbing issues: You don’t want to be knock, knock, knocking on heaven’s door when you take a shower, so don’t be shy about turning on the taps to check for hammer issues. Make sure the water pressure is good and the drains are operating well.

Dampness: Stains, water marks and damaged or peeling paint may indicate the property has issues with dampness. Sometimes, vendors try to paint over problems, so channel your inner canine and use your sense of smell during the inspection.

Mould: This may be an indication of a bigger, more expensive problem, such as a leaky roof, plumbing issues, inadequate ventilation, or rising damp. All of these can be expensive to fix, so check bathrooms, ceilings, window frames and walls meticulously.

Termites: When you’re inspecting properties, look for the tell-tale signs – sagging or buckling floors, hollow-sounding beams and “mud leads”. A bad termite problem may produce a sweet, sugary smell. No matter where you live in Australia, always get a pest inspection, because termites are everywhere and they can be costly to evict!

Wiring: If the property is sporting a 1970s chandelier, or antiquated switches and sockets, the electrical wiring may be outdated and it could end up costing you to rewire. Check the electrical box as this will tell you when the system was last updated. If it does not have a residual current circuit breaker, then it has probably not been brought up to modern standards.

Appliances: It’s always a good idea to take a good look at the fixed appliances such as the oven, stove, air-conditioner, dishwasher and heating system. If they look like they are on their last legs, you’ll need to factor in the cost of getting them replaced.

Renovations: Homes at the less pricey end of the market often have outdated kitchens and bathrooms. Many first home buyers think they can live with the situation until they save up to do a renovation, however you need to be realistic – these can be expensive to replace so get a quote so you can factor it into your budget! If renovations have already been done, check the quality.

Asbestos: Properties built before 1990 may contain asbestos. During the inspection, find out when the property was built and ask about the construction materials. If the property is of ‘fibro construction’ it probably has asbestos – which is not dangerous if it is in good condition, but get your building inspector to check carefully before you move ahead with a purchase.

Roof: Stand back in the street and cast your eye over the roof. What is it made of – tin or tiles? Is it rusty? Are there any missing or damaged tiles? Does the pointing between the tiles look crumbly? These can all indicate the roof needs work, so if it looks at all suspicious, be sure to get it checked out properly as a new roof can be costly.

We hope you’ll find our inspection guide handy! But remember, even if you’ve developed an eagle eye and a nose for trouble, protect yourself by getting professional building and pest inspections before you buy anything! If you need a referral to a reliable inspector, just let us know. Before you set out on your buying journey, it’s a good idea to talk to us so you can determine your budget and get pre-approval on your home loan. Then once you find the right place and it’s been given the all-clear, we can help you move quickly. We’d love to help with your first home buying journey, so please get in touch!First home buyers, what to look out for when inspecting properties

If you’re looking to buy your next home, downsizing might be the way to go. After all, sometimes less is more and it could work wonders for your finances!

In this article, we explore some of the benefits of downsizing – from cutting back on maintenance and energy costs, to having more money in your pocket to invest. And remember, when you are ready to purchase your next home, we’d love to help you find a loan that meets your financial needs and future aspirations. Here are some of the key reasons to consider downsizing.

More funds to invest

Downsizing allows you to unlock the equity in your current home to use for investment purposes. If you are lucky, you may be at a point where you’ll be able to pay off your new home with cash, then use any leftover funds to expand your property portfolio and start generating income from an investment property. You could also use the money on a new car or other lifestyle pursuits. If you’re interested in investing in property, just give us a call, we can help you in many different ways.

Fewer expenses

Downsizing can drastically reduce your expenses, from cutting your mortgage repayments, to slashing your living costs. Energy is one area you are likely to notice real savings when you move to a smaller property. What’s more, downsizing may encourage you to stop blowing money on furniture, appliances, electronics and “stuff” you don’t actually need. It will also encourage you to get rid of unnecessary clutter – there’s only so much you can squeeze into a smaller home, after all.

Lifestyle benefits

Looking for a sea change or a tree change? Downsizing could provide a great opportunity for you to live in a more desirable location, in housing that is more suitable for your needs. There are many great locations to consider – from the coast to the hills, you can find great value properties in communities where you can indulge your personal interests. Sailing, hiking, exciting adventures in your caravan – you name it! If you’re ready to retire, an empty-nester, or are recently single, downsizing could be the fantastic new chapter you’ve been looking for!

Let’s face it – bigger properties can be hard work. Not everyone wants to spend their life maintaining a larger property or garden. Just think of what you could do with the time it takes to clean and maintain that great big house. Golf-course here you come!

New tax breaks

In the 2017-18 Federal Budget, the Government announced plans to encourage older property owners to downsize. This is intended to help free up larger homes for younger, growing families. From July 2018, retirees may be able to inject up to $300,000 into superannuation if they sell their home after they reach the age of 65. The existing voluntary contribution rules for people aged 65 and older (work test for 65-74 year olds, no contributions for those aged 75 and over) and restrictions on non-concessional contributions for people with balances above $1.6 million do not apply to contributions made under the new downsizing cap.

To qualify, you must have owned your property for 10 years. What’s great about this new initiative is that both members of a couple can take advantage of the measure for the same home – that means as much as $600,000 per couple can be put into super! However, keep in mind that the proceeds contributed to superannuation will be included in the assets test for the age pension. For more details ask your tax accountant – if you don’t have one, ask us for a referral, we’ll be happy to help.

While it’s tempting to hold onto the family home because of the sentimental value, the reality is that it may be holding you back from a better lifestyle and a more comfortable financial situation. Downsizing could allow you to find a home that’s more appropriate to your lifestyle, while also freeing up time and money to use elsewhere. If you’re looking to purchase your next home and would like to explore your home loan options, please don’t hesitate to get in touch! We would love to find you a competitive home loan that works to your advantage.4 benefits of downsizing

Australians are a nation of investors. Over 60% of us hold additional investments outside of compulsory superannuation and increasingly, property is one of our most popular investment choices. But why? And is it the right form of investment for you?

If you’re not sure, the sooner you talk to a qualified Financial Planner the better! And if you don’t have one, ask us for a referral to a reliable professional who can help you come up with an investment plan that’s right for your personal circumstances and goals. To get you started, here are six reasons why an ever increasing number of Australians are considering a property investment.

1. Supply & demand.

The value of any given commodity is subject to the law of supply and demand. When demand is greater than supply, the value goes up. Therefore, investing in something people need or really want is generally considered a good idea. Everyone needs somewhere to live, and most of us want to own our own home, which is why many Australians consider property to be a good investment type.

It may seem a bit over-simplistic, but the statistics tend to support this popular opinion. For example, 2016 figures from the Victorian Department of Environment, Land, Water and Planning estimated that Melbourne’s population will double by 2031 and hit 10 million people by 2050.

2. You have greater control over managing your investment.

When you invest in a property, you are in charge of that asset. You can do things to affect the property’s ongoing capital growth potential, like keeping it in good repair and up to date, and you can choose the right tenants to maximise your rental income. You may also have some potential to affect the end value of the asset – by getting it rezoned for development purposes, or performing extensions or renovations, for example. You can also take out insurance on the asset, which can help to insulate you against some of the financial risks of property ownership.

By comparison, with stocks and shares, value growth is subject to the success of the company and a variety of other external factors which are usually beyond your control. These uncertainties may influence some people to prefer a ‘solid’ asset like bricks and mortar.

3. You can easily assess capital growth potential and invest accordingly.

When investing in property, careful research will help you to choose a suburb or area that has capital growth and rental income potential. This information is relatively easy for the average person to acquire. (For example, we can provide you with a variety of reliable reports, as will most banks, and there is a variety of other property data suppliers online.) By contrast, assessing the capital growth potential of other kinds of assets is much more complex and often requires expert analysis, or access to information that isn’t as easy to obtain.

With property, some areas have more potential than others, so smart investors spend time locating and investigating opportunities that could align with their investment strategy. For example, you can research future population and employment growth in an area, transportation links and future infrastructure development, lifestyle amenities, schools and other factors that are likely to make the area popular with buyers and tenants down the track.

4. You can access the equity to continue growing your wealth.

Property investment can be like an “investment money tree” because it is possible to access the equity (or capital gains) as you go along by refinancing, without being liable to pay tax until you actually sell the property. With an investment property, equity is created as soon as it increases in value or your tenants pay down your mortgage somewhat, so you can often plan to access your equity (subject to refinance approval from a lender) for your next investment. You could use that money to buy any kind of investment, not just property, which is why property is often considered a good way to start an investment portfolio. If you’re interested in refinancing a property to access your equity, just give us a call.

5. The opportunity to diversify your portfolio.

When investing, a good Financial Planner will probably tell you that it pays not to keep all of your eggs in one basket. Including property in your investment portfolio could potentially provide an opportunity to spread your risk. And in itself, property investment provides opportunities to diversify your investments. For example, you could invest in a variety of locations and in different types of properties – vacant land, apartments, units, houses, rural or perhaps commercial properties. Talk to your Financial Planner for suggestions on how to create a diversified investment portfolio that takes your personal appetite for risk into consideration.

6. You can take advantage of tax breaks and super.

Another advantage of property investment is that it is supported by a variety of tax breaks and government incentives to help people grow wealth. There are many different ways you could potentially benefit, depending on your personal situation, tax obligations and other financial circumstances. Talking to your Mortgage Broker and Tax Accountant to find out more is a great idea, because the benefits are different for everyone and no-one wants to give their money to the tax man when they could be using it to fund a better retirement.

What to invest in is an age-old debate and property investment may not be the right choice for everyone. But if you’re keen to join around 1.7 million Australians who choose to invest in property, we’re here to help! We’re happy to work with you, your Financial Planner and your Accountant, and then arrange the appropriate financing to meet your financial circumstances, needs and investment goals. Please get in touch, we’d love to hear from you!

This article provides general information only and has been prepared without taking into account your objectives, financial situation or needs. We recommend that you consider whether it is appropriate for your circumstances and your full financial situation will need to be reviewed prior to acceptance of any offer or product. It does not constitute legal, tax or financial advice and you should always seek professional advice in relation to your individual circumstances. All loans are subject to lenders terms and conditions – fees, charges and eligibility criteria apply.6 Reasons why property investment is more popular than ever

You’ve budgeted hard, given up loads of smashed avocado brekkies, saved your deposit and are ready to buy your first home. High five!

There’s nothing quite like finally getting a foothold on the property ladder and moving into your very own pad, but it does require planning and research. With our help, you’ll soon be doing a victory dance and posting that exciting Facebook post of you in front of a shiny ‘SOLD’ sign. Here are our quick tips for buying your first home.

1) Talk to us about how much you can borrow

Your home ownership journey begins with a chat with your mortgage broker! There’s no point wasting your life inspecting properties that are outside your price range. We’ll help you determine your borrowing capacity, set your buying budget and explain about applying for the First Home Owner Grant and making the most of any other exemptions and savings you may be able to obtain to help you get started.

The amount you can borrow will depend on the size of your deposit, your savings history, income, expenses and credit history. It’s a good idea to save 20 per cent of the purchase price, plus the other costs associated with buying property like stamp duty, legal fees and building and pest inspections.

You may still be able to buy now even if you don’t have a 20% deposit, so talk to us about your plans. If you don’t have a 20% deposit, you may still be able to get a home loan, but you will have to pay Lender’s Mortgage Insurance (LMI) which protects the lender against any shortfall if you default on your loan and it has to be sold to repay your debt. Sometimes it’s worth paying LMI if it means you can get on the property ladder sooner, so talk to us and we’ll help you decide if its best to buy now or wait until you’ve saved more.

2) Get on the property ladder sooner rather than later

In most cases, it’s a good thing is to jump aboard the real estate train pronto! The sooner you stop wasting money on rent and start making capital gains on your property, the better. But getting into the market sooner rather than later might mean compromising. You might not be able to afford your dream home immediately, but the property you buy may be a stepping stone to greater things. If your desired location is too costly, you may have to consider buying in another suburb, purchasing an apartment or a more modest home, or finding a “renovator’s dream”. Remember, from little things big things grow and you can always trade up in future.

3) Learn how to research the right property to buy

Once you know your price range, you can use it to find prospective properties to inspect and identify areas that you can afford. Location is key, but you also have to factor in affordability. Research the areas and properties you are interested in very thoroughly. Consider the capital growth potential, rental yields and proximity to schools, transport and other amenities – this can be confusing, so if you need help just ask us.

When you find a home you like, research it by arranging building and pest inspections to ensure the property is structurally sound and free of unwanted guests. If the property is going to auction, you will need to do this beforehand.

Buying your first home is exciting, but it’s important to seek professional advice. As your mortgage and finance specialist, our services are free and we’re happy to help you in any way we can, even if you’re not quite ready to buy right now. We’ll help you with your budget and deposit saving plan, guide you through the buying process, ensure your financial goals are taken into consideration, and provide ongoing support in the future. Save yourself time, money and stress by getting in touch with us today!3 Top Tips for Buying Your First Home


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