Posts Tagged banks

Can Sydney’s housing affordability be fixed in five steps?

Australia has ranked as one of the least affordable countries in the world for housing again – but solutions are on the way. Demographia’s 2017 report ranked Australia third behind Hong Kong and New Zealand for unaffordable housing, largely driven by price hikes in Sydney and Melbourne.

Of course, that’s nothing new. Anyone who’s tried to secure a home loan in the last five years would understand the issues with many east coast housing markets. But what about solutions?

The Property Council of Australia (PCA) has come to the rescue – in a sense. It has released a five-point plan it believes can address affordability in New South Wales, if the government will adopt it.

Can you really fix the Sydney market in five steps?

Can we really fix the Sydney market in five steps?

Five points to fix it all

Jane Fitzgerald, NSW Director for the PCA, says the five-point plan has already been delivered to the Reserve Bank and the New South Wales government. She believes the following steps will go a long way to helping struggling buyers:

  1. Reform the planning system to increase land and housing supply
  2. Cut red tape, property taxes and fees
  3. Increase cooperation between Federal, State and Local Government departments
  4. Provide more support to first home buyers
  5. Increase innovation in the rental market

Now, that’s a lot of buzzwords without many tangible measures. But, as Fitzgerald notes, the PCA does have a full report outlining what the NSW Government can specifically do to make sure it achieves these goals.

Items like less stamp duty, a higher level of housing supply and more FHB support will certainly be music to the ears of buyers who are yet to get onto the ladder. CoreLogic RP Data’s monthly indices show the median house value for Sydney is still above the $1.2 million mark – something has to be done to make buying easier.

Give yourself every advantage you can

Of course, this is a proposal put to the government – it’s far from concrete. For now, anyone struggling to make a property purchase has to wait and see. That is, unless they start taking matters into their own hands.

One way to start working on affordability issues is to make sure you have access to the full spectrum of home loans. Too often, people restrict themselves to just one or two types of mortgage, thinking that’s all they have to work with.

By using a mortgage broker, you can tap into dozens of home loan products, each tailored to a different financial situation. It won’t necessarily fix the housing market – but for some people, it can help out a lot.

You can contact me Kim Wight Mortgage Broker Sydney on 0412 167 551  for mortgage advice.

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Your Credit Score

Ok so you  have heard about this thing called your credit score but do you really understand what it is?   I have come across a helpful service that will allow you to look up your credit score with VEDA (at no cost). VEDA is the biggest credit reporting company in Australia and virtually all of the banks and lenders buy information from them (to varying degrees).

Obtaining your score on this website will only take around 1 minute.

Before you get started, the credit score is just that, a bottom line score. The score does not show your detailed credit history.  We should also note that most lenders have their own scoring systems that only partially use VEDA information.

Each of the scoring categories below have implications for your future credit applications.

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If you want to discuss this or any other finance questions please call me Kim Wight Mortgage Broker Sydney on 0412167551 or email


Posted in: Bad Credit History, Blog, First Home Buyers, Latest Mortgage News, Mortgage Broker Sydney

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The Renter-Investor

Are you a renter-investor?


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If you are, you’re one of a savvy group of first homebuyers who have chosen to purchase an investment property instead of their first home.

The rise of the first homebuyer as ‘renter-investor’ shows borrowers are thinking outside the square to get a foothold in the property market without compromising lifestyle.

Not only do people want to live in areas that suit their lifestyles now – near beaches or cafés or in inner city lifestyle suburbs – but they’re also keen to live close to their workplace so the commute to and from work doesn’t eat into their valuable personal time.

With the cost of properties located in these ‘lifestyle areas’ out of reach for many first homebuyers, they’re taking a more creative approach.

Be vigilant and strategic

While all borrowers need to have a clear strategy and structure their lending accordingly, this is of particular importance for first-time rentor – investors

There are a number of considerations that first-time property investors need to think about. For example: What is your strategy? Are you looking to buy and sell an investment property within five years or are you planning to purchase and keep it as an investment offering growth over a long-term period of, say, 10 or 20 years?

Will you then draw equity from it to use as a deposit for a home or another Investment property in the future?

It’s important to do your homework – ask yourself why and where you’re going to buy your investment property, and what the expected capital growth rates and rental returns will be in the areas you’re looking to purchase.

The answers to these questions allow you to run projections of what sort of gains you could expect to make if you sell in the future.

Of course you would also need to consider a range of costs including buying and selling expenses, capital gains, tax implications, and fees for professional advice.

Property investors also need to consider a range of factors that are best discussed with their mortgage advisor first and then with their accountant.

For example, if you purchase an investment property with a view to selling it within, say five years, you will have to pay capital gains tax.

Conversely, if you’re going to hold the property for a longer period of time and draw on the equity to fund a home or additional investment properties, then you won’t need to pay selling costs and capital gains tax and, as such, your mortgage broker can help you to structure your lending to suit.

There are also a range of options available to minimise cash flow shortfalls when owning an investment property, such as making interest only payments, maintaining depreciation schedules, conducting regular rent reviews, and having tax adjustments paid back to you monthly.

 Borrowers should discuss this with their mortgage broker and accountant so they can structure their lending and finances to their advantage.

Renter-investor approach not just for first homebuyers

Our living circumstances can change for a host of reasons: You may have received a job offer that requires you to move to an inner city location or you may just want to live in a suburb that offers the lifestyle you and your family desire, now. As a result you may decide to rent out your home and make it an investment property.

Likewise, you may live in an area that is currently achieving good capital growth and yielding excellent rental returns for homes like yours, so you decide to rent a smaller property elsewhere in order to rent out your existing home.

There is a range of reasons for choosing to rent while putting your owner-occupier property on the rental market.

Regardless of your circumstances, seek the advice of a quality mortgage broker to help you structure your lending and get the most out of your investment strategy .

I hope you have found this information useful and if you have any questions please contact me Kim Wight Mortgage Broker Sydney at

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Why Use a Mortgage Broker


When I meet people and tell them I am a mortgage broker and explain I arrange loans for my clients they often say Why Use a Mortgage Broker and not go directly to a bank.

Here a few reason why you should be using me Kim Wight as your mortgage broker.

As your mortgage broker I need to be up-to-speed with lenders’ ever-changing policies – not only where to find the best deals but which lender will accommodate your unique personal circumstances.

Package your loan application
Lenders are getting more selective about the level of risk to which they’ll expose themselves, so they’re looking for borrowers with genuine savings who can show discipline with their finances.

Lenders will scrutinise a borrower’s credit history with even a seemingly insignificant late phone or credit card bill repayments potentially jeopardising a loan application.

As your mortgage broker I will package your loan application to make sure you’re presented to lenders in the best possible light.

Get organised
Being disorganised in your finances could lead to a loan application being declined. If a lender needs more information during the loan application process, it’s important to respond to this immediately, otherwise the momentum can be lost. It can take time to get your loan application back on track. This is especially the case when refinancing or topping up a loan.

As your mortgage broker I will work with you to pull together all the paperwork needed to support your loan application.

Finding opportunities to save
Opportunities to save money can come from anywhere.

There may be greater flexibility for customers who already do business with a particular lender – even if you only have something as simple as a credit card or transaction account.

Also, because  as your mortgage broker  I have great relationships with the lenders, depending on a range of factors  I  may be able to negotiate a significant reduction on the interest rate, the waiving or reduction of fees, or some flexibility on the amount that can be borrowed.

 No Charge for My Service

Yes that is right I do not charge you to arrange your loan and work with your solicitor or conveyancer to get the loan to settlement. I am paid a commission from whichever lender you decide to use.  My team and I take all the stress out of getting a loan.

How can I, Kim Wight Mortgage Broker Sydney help you?
Call me on 0412167551 to chat about your situation and find out what options are available to you. 

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Beginners Guide to Home Loans Myths


Mortgage Broker SydneyDon’t believe everything you hear about home loans. Seek the truth from a professional. This Beginners Guide to Home Loans  Myths can help understand the home loan process and clear up some of the misinformation you might hear.

I have been involved in arranging home finance for people for many years. I have worked for a major bank and finance company and as I write this guide to home loans, I have been an independent Mortgage Broker in Sydney  for 13 years. With 25 years of experience and access to information from other highly experienced brokers and bankers I still get challenged by clients who sometimes do not like what I tell them, if only they had read this guide to home loans and not believed what their other “experts”had told them !

There is a lot of “water cooler” talk out there in the market place and people, while trying to be helpful, will offer advice on borrowing money or structuring loans. Beware, quite often this advice is based on hearsay and not lender policy or principles, that’s where this guide to home loans comes in. You may have heard people say “just get a guarantor”, or, “you need a credit card to get a credit rating before you get a loan”.  Or perhaps the old favourite “I can buy a house and consolidate all my other debt into the mortgage”. While some of this information may have some relevance in some circumstances, in a lot of cases it is just plain wrong. I hope this guide to home loans will dispel some of these myths to help people looking for a home loan get onto the right track.

Guide to home loans – Myth No 1. You Have to Shop Around for the Best Deal

While I agree you need to look at many loan options BEWARE how you do it. This part of my guide to home loans will help you choose how to research a home loan that is right for you.

Nowadays with so much information on the internet many people use it to source loan information. But what I have seen happen is people can get into a trap of applying for a loan on line with out knowing they are doing it, if only they had read this guide to home loans! Mistakenly applying for a home loan can also happen sometimes if you meet with a lending manager in a Branch. With these methods sometimes before you know it your details are entered into the lenders computer system, a credit check done and you are told your loan is approved subject to you providing the supporting income and savings evidence.  While you might be please to know the lender will give you a loan you were really only shopping around and had not made a decision on the lender of your choice but now you have this application recorded against your credit rating.

Most lenders now use an online credit scoring system to assess loan applications. The human personal element has been removed. Here is a secret the banking industry doesn’t tell you. There are about numerous fields in an application that get a “Score”.  No one knows the exact number of fields, the lender can’t or won’t tell us.  If the score comes in outside the approval score your application is automatically declined. Have you seen Little Britain, “The computer says No”. If the computer says no it is very hard to get it overturned. It might be possible to have it overturned but it will delay your application at a time when time is of the essence. One of the main reasons loans are being declined with this credit scoring system is too many credit enquires over a short period of time on a client’s credit check report. From a lenders point of view they do not know that you have only been shopping around and did not actually proceeded with the loan applications that appear on your report. Their thinking is if the previous lenders would not approve a loan for you why should they take the risk and your loan is declined.

Guide to home loans – Myth No 2.    You can have a guarantor

So many times I have new clients coming to me and saying “my father will go guarantor” so I can get the loan. It just does not work that way, this part of my guide to home loans explains some of the ins and outs of having someone being your guarantor on a loan.

A guarantor can not be used to help you borrow more money than you can afford on your income alone. If their income is needed to help repay the loan the lender will require them to be a co borrower and their name will be on the loan. This in turn will restrict them from borrowing money in their own name as they now have a loan listed on their credit report. The only way a guarantor can be used is by offering an additional property or cash as security against a loan in order to save the cost of mortgage insurance.

When you are buying a property and you need a loan unless, in most instances, you have savings to cover not 20% of the purchase price plus stamp duty and legal costs you have to pay a once only mortgage insurance premium. This premium protects the lender in case you default on the loan. The premium can be thousands of dollars. Most lenders allow a guarantor in this instance.  The guarantor has to offer a property as security for the loan and the amount of the guarantee is limited to the mount required to have property offered as security covering up to 20% of property purchase and associated costs.

This form of guarantee is often referred to as a family guarantee or family pledge.

It is important to note that the guarantor in this instance is not being assessed in order to make repayments on behalf of the borrowers. Their guarantee is only being used to save the borrowers the cost of the mortgage insurance.  There usually has to be a family connection in order for this guarantee to be approved and the guarantor has to obtain independent financial and legal advice.

Should the borrower default on the loan both the borrowers and guarantor’s property could be sold to cover the amount owing to the bank.  In most cases should this happen it would be in the guarantors favour to try and arrange finance to cover this limited guarantee and have his property handed back to him. The problem arises then the guarantor does not have the borrowing capabilities to finance the amount of debt he has guaranteed.

Guide to home loans – Myth No 3.  I need to borrow money and get a credit rating before I can get a home loan.

I often hear clients say I have to borrow money on a credit card or personal loan to get a credit rating so I can get a home loan. Borrowing money on a high interest loan just to get a credit rating is just throwing good money away. There are other ways to build a great credit rating – these will now be explained in this guide to home loans.

What you really need to do to get a home loan is show a good savings history that will demonstrate to the lender that you have the income and lifestyle to commit to and repay a home loan.

When a lender is accessing you for a home loan they look for a savings history, stability of employment and your ability to repay the loan based on your income and other loan commitments. By having a credit card or personal loan the amount you can borrow is reduced.

If you have borrowed money in the past and missed payments or defaulted on the loan this will make it very difficult to be able to get a home loan.

Guide to home loans – Myth No 4. I can combine all my debts into my home loan.  

 Time and time again I have clients coming to me and they want to buy a property or refinance their current loan and also combine all their current debts into the new loan. This part of my guide to home loans will explain your options for debt consolidation.

This can only be done if you have enough equity in the property you are giving the lender as security for the loan. By equity I mean the difference in the loan amount to the value of the property. An example of this is you have a loan of $400,000 against a property worth $500,000 which means you have $100,000 equity or 80% equity.

When you are combining additional debts into your home loan this is seen as refinancing and the lender will only lend up to 90% of the value of the property held as security. Most first home buyers borrow between 90% to 95% of the value of the property so combining additional debts is not an option available to them.


No guide to home loans is complete without some tips for making the process of obtaining a home loan run smoothly.

Guide to home loans – Truth Number 1. Seek the Advice of an expert.

When you are looking for a home loan or even once you have one you will constantly have people giving advice on what can and can’t be done. Some advice will be correct, some will have once been right but now due to changes in lending policies will be obsolete and some advice will be just plain wrong. That’s where my guide to home loans, and more importantly personalised advice I can give you, comes in handy.

In order to ensure that you have the most up to date information you need to be speaking with the people who are involved on a daily basis with a variety of lenders and know their policies and procedures.

I have been advising people on home loans for over 25 years and have not only the knowledge and experience that comes with working in the home loan field but I also have the latest information at my fingertips due to the technology I have available to me.

My best advice to you is before you believe any of the “water cooler” talk about home loans you contact me to confirm what you have heard is true of false.

Guide to home loans – Truth Number 2. Know what is on your credit report.

Everyone should be aware of what is on their credit report. My guide to home loans will help you sort this out.

You can get a copy of your report at  You will wait 10 days for a free report or for about $60 dollars it can be emailed back to you in an hour. I provide these free for my clients if we think there may be a problem. So how can you shop around safely, investigate your options and not have your enquiries recorded on your credit report? The best way is by meeting with a reputable mortgage broker who is a member of the Mortgage & Finance Association of Australia.  A  member of this organization has a standard of ethic and education they must meet and you can feel confident you are dealing with a professional.

Guide to home loans – Truth Number 3. Get the best advice and information.

A mortgage broker will be able to show you various interest rates and loan products from a number of lenders. They can also discuss your personal situation and advise you on what loan product best suits your needs. Each lender has different criteria when they assess your loan application and some lenders will offer you a bigger loan than another lender. A mortgage broker can sort through all the options and you get to pick the loan that you want.  They know the policies and procedures of the lenders and can save you a lot of time and effort by talking through any loan characteristics that may or may not suite your situation.

A Mortgage Broker really is a one stop shop for your home loan needs.

I hope you have found this information useful and if you have any questions please contact me Kim Wight Mortgage Broker Sydney at



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The Extra Cost of Mortgage Insurance

Mortgage broker sydneyWhen are you looking get a home loan to  buy property do you think that the only thing you need  look at is the home loan interest rates and any fees?  Do you know about the extra cost you may have to pay of mortgage insurance?

In most cases whenever you are borrowing more than 80% of the value of a property you have to pay mortgage insurance, sometimes refer to as LMI, Lenders Mortgage Insurance.

This is a once only payment for insurance which covers the lender in the event you default on your home loan and they have to come in a sell the property. If the property is sold at an amount lower than the amount you owe the lender they will call upon the mortgage insurance to cover the difference between the sale price and the loan amount outstanding.

End of story you might think. Well no, because then the mortgage insurance company will try to recover the amount they have paid out to the lender from you.

Can I save on the cost of mortgage insurance?

When you are looking for a home loan it is also advisable to consider the cost of the mortgage insurance which is added to the amount borrowed. There are two main mortgage insurance companies used by most lenders PMI and Gemworth and like all insurance cover the price can change from lender to lender.   Some lenders self-insure, some are charged lower premiums from the insurance companies and past these savings on to their customers.

Recently I had a client who was borrowing over 90% on the value of a property. By choosing a lender based not only on a low interest rate and fees I was able to save her $2295 in mortgage insurance cost. When you consider that she would have been paying interest on this amount the savings is many $’000s over the term of the loan.

So when looking for a home loan consider all the costs and seek professional advice from a mortgage broker who can investigate all options.

I hope you have found this information useful and if you have any questions please contact me Kim Wight Mortgage Broker Sydney at

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Buying At Auction – What You Need To Know

Mortgage Broker SydneyBuying property at auction can be a daunting task, and with more and more properties being sold by auction these days it is important that you understand the process and have your finance in place before you bid.

When you are buying property at auction there is no cooling off period, which means once the hammer is down you have bought the property and have to proceed to pay for it. Unlike a property that is sold by private treaty you do not get 5 days to arrange finance and do property searches all this must be done before the auction.

The most often asked questions people have when buying property at auction are:

1. Can I have the loan approved before I bid?

I advise all my clients to have their loan application assessed before starting negotiation on any property purchase but if you are buying property at auction you need to know in advance that you will be able to get a loan for the amount of money you need.

We can arrange to have your loan pre approved which means that the lender will look at your credit report, income, savings, assets and any other debts you may have and then pre approve you for a loan based on this information.  As you cannot be sure how much you will have pay when buying property at auction, the loan cannot be formally approved.

When buying property at auction, I suggest to all my clients that we get the loan approved for the maximum amount your income can service and that you feel comfortable with and then lower the loan amount once you have successfully purchased the property and we know exactly how much loan money is required.

The loan preapproval with be subject to a valuation on the property and if you are borrowing more than 80% of the property value acceptance by the mortgage insurance company.

There is always an element of risk buying property at auction with no cooling off period but with the right pre work the risk is greatly diminished.

2. Can I have the lender value the property before the auction?

This question is always a tricky one.

When buying property at auction and there is a contract of sale with an amount on it a valuer will base their valuation on the sale amount plus comparative sales in the area. Because someone was prepared to pay the amount on the contract as long as the amount is not unrealistic based on other sales in the majority of cases the valuation will come in at the sale price.

When there is no contract of sale the valuer will base their valuation on comparative sales and the property may value at less than you are prepared to pay. If the Bank has done the valuation before the auction they will accept the valuation amount not the purchase price when accessing the LVR (loan to valuation ratio) which may result in a reduced loan amount or an increase in the cost of mortgage insurance.

Again, when buying property at auction there is an element of risk that the property may not value at the purchase price but if you have done your research  and keep your cool at the auction and do not exceed the maximum amount you believe the property to be worth the risk is extremely low.

In my 25 years of lending I have not had a property purchased at auction come in lower than the amount paid. This gives you confidence to use my service when buying property at auction.

3. How do I know how much to pay?

You need to research property prices in the areas you are looking at prior to buying property at auction. You can do this by attending open houses and gauging the value of the property by the asking price and what the property has to offer in way of size, location, quality of fittings, décor.

You can look on the various real estate sites at the sold properties which often list the sale price.

The easiest way is to ask me to provide a free RP Data property report on any property you are considering buying property at auction, or indeed any property at all.  This will give an estimate of the current value and list comparative sales in the area. This report is one of the tools the valuers use when assessing the value of properties and I can give you free access to it.

4. How can I buy before I sell my current place?

This is the problem existing home owners find themselves in and causes the most stress when buying property at auction or otherwise.

If you sell before you buy what if you cannot find a property you like, but if you buy before you sell how can you afford to pay for the new property?

I always advise my clients who are in this situation to ask for an extended settlement time. Most contracts of sale have a completion date of 42 days (6 weeks) after the signing of the contract.  If you can extend this time to 10 or more weeks to allow you to sell your property you do not have to consider bridging finance.

With a bridging loan, the lender will loan you the money to cover the gap between settlement and buying a property at auction or otherwise. Effectively, the lender agrees to take on both mortgages. Bridging finance typically covers a period from a few days to a few months.

This form of finance is expensive because in most cases your existing loan and the full amount of the new purchase are combined and interest accrues on the new total loan balance. The lender will access your ability to repay the loan based on the amount you will owe after the sale of your existing property. There are additional fees due to the lender having to value two properties plus other associated costs.

There are strict criteria for bridging finance before approval is given which will include the unconditional sale of a borrower’s existing property and restrictions on proposed settlement terms. Other conditions may be imposed on a case-by-case basis. The finance is usually only available for 6 months after which penalties may apply.

My advice is to allow me to fully access your personal situation and together work on the best strategy for you when buying property at auction.  I have always bought before I sold so I understand the stress involved in purchasing this way but with careful planning the stress can be reduced.

5. I haven’t sold my place yet so how can I get the money to pay the 10% deposit.

Once you find the perfect house and you have the thrill of buying property at auction, you sign the contract of sale and will be required to pay the 5% or 10% deposit which ever amount has been agreed upon. If you do not have the money and cannot borrow it short term from family we will need to arrange a deposit bond for you.

A deposit bond is basically an insurance policy. The deposit bond is the policy document that tells the vendor that the insurance company will pay the 10% deposit to the vendor if you for some reason do not proceed with the purchase. The insurance company will then endeavour by all legal means at their disposal to get the bond money back from you.

There is a once only premium paid for the bond. When purchasing at auction the premium is calculated on the maximum amount you are prepared to pay. If you are unsuccessful at auction the bond can be returned and a portion of the premium refunded.

In the normal course of events settlement takes place, the purchase price is paid in full and the deposit bond simply lapses

6. Other than the loan what else should I organise?

Buying property at auction can be an expensive exercise as you have to do all your due diligence even though you may not be the successful bidder but it could be even more expensive if you do not.

  • Have a solicitor review the contract of sale. They can address any conditions of the contract that may not be in your best interest and can also ask for an extended settlement if required. They will also arrange any searches that they feel would be in your best interest to undertake such as strata reports or building surveys.
  •  Get a pest & building inspection done. It is important to find out if there are any building or pest problems before you buy.
  • If you are buying before you sell have the contract for sale for your existing property ready. If you are the successful bidder and you need to sell your existing property time will be of the essence and you need to move quickly to list your property for sale. By law a real estate agent cannot show a property unless they hold a contract of sale. By having your solicitor prepare the contract you will lose no time it getting your place to the market.
  • Have a Real Estate Agent lined up ready to put your property in the market. Again as time is of the essence to sell your current property by having already decided upon the real estate agent you want to sell your property you will save time. A good agent will be able to arrange photos and have your property listed in a day or two. They may already have people to show through which will give you confidence for a sale.
  • Have your house prepared for sale. I cannot stress enough the importance of being prepared to list your current property as soon as you have purchase. Now is not the time to think about decluttering, fixing the gutter, cleaning the carpet etc. you want your house to be ready to show to potential buyers immediately. Have all the jobs that needed to be completed done so you can attract that potential buyer.

As you can see they are many things to consider when buying property at auction. I hope you have found this information useful and if you have any questions that I may not have covered please contact me Kim Wight, Mortgage Broker Sydney at this web page or at

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Investment Property Gurus- I Don’t Trust Them.

If I had a dollar for all the “investment property gurus”, that contact me on a regular basis with the offer to assist my clients in making the right property investment decision I could retire and not live long enough to spend all my money.

Mortgage broker Sydney

But the problem I have with 99.9% of the people who contact me is I don’t trust them and I do not believe they have my client’s best interest at heart. These people offer the “get rich quick”  “guarantee return on investment” which is all too often too good to be true. In my experience these property spruikers target people who are looking for a quick fix and do not understand the property market.

Property investing and creating wealth is a long term strategy and takes time.  My advice to people who attend these property investment seminars is to go with an open mind but be sceptical and if it sounds too good to be true it is probably a con and beware.

Say, “No!” to bad property investment advice!

Some things to look out for when dealing with these property spruikers

1.    They are trying to sell you a property rather than provide you with advice to your specific situation.

What I often see is that they are more interested in getting the sale without finding out about your personal situation and even if you can afford it. I had a new client come to me who had contracted to buy a property off the plan but with their income and other commitments had no hope of getting the finance. Even if we were had been able to get the finance the completed properties were not worth the price originally paid due to a turn down in the market.

2.    They offer a One Stop Shop.

Most often they will not only sell you the property but  encourage you to use their recommended solicitor/ conveyance, accountant, ,mortgage broker, real estate property management agent all of who are most likely  being paid a commission from the sales agent. You must use your own independent legal and finance people to ensure you get the best advice for your interest.

3.    They offer “dodgy” loan structures.

If have heard all too often the sales line of pay $150,000 off your home loan in two years. They then set up loans where the rent and your income pays down to your home loan while the loan repayments and living expenses are taken from a line of credit. Sure you may have paid off your home loan but you have only moved the debt to another loan product. Get independent finance advice.

4.    The properties are interstate.

The problem of buying interstate is if you do not know the area and prices you may be paying well over the market price. You need to do your own research. I had one client who flew interstate to buy a property only to find he could get a better property closer to the regional centre he was looking at a much cheaper price. Needless to say he did not proceed.

Avoid being ripped off.

Do your own research. Get property reports which show comparative sales. I even had clients who rang the local police station to see what the crime rate in the area they were looking to buy in.  If you do not know the area I thought this was a great idea.

Arrange your own finance through an independent broker or your own bank.

Have your own solicitor or conveyancer look over the contract and handle the settlement for you.

And remember “buyer beware” and if it sound too good to be true it probably is too good to be true.

I hope you have found this information useful and if you have any questions please contact me Kim Wight Mortgage Broker Sydney at

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mortgage broker sydneyA lot of people think that my role as a mortgage broker is to just get you a home loan.   While this is the primary duty I am also called upon to work with people when they are going through some of the toughest times of their lives, the break down of a relationship.

This week a long-time client contacted me asking to speak with me because she had had a really tough year and needed to know her options. These kinds of requests usually alert me to an impending relationship break down.

This client was doing the right thing by asking for advice regarding  her refinancing and borrowing options before she discussed with her partner and legal team.

I find people when people contact me they are very open and discuss some of the details for the break up that they may not have shared with anyone else.  While I do not need to know all the reasons for the breakup I do need to know of any financial problems that we need to work through. Have mortgage payments have been late or if the home loan is in default?  Have there been problems with credit card debt?

By talking through the situation together we were able to consider a strategy for keeping the family home and also what the client’s options would be if the home had to be sold.

Recently I had a new client come to me following their family court agreement.  They were upset that they had to sell the family home and now needed to buy another property. When I looked at the income and figures it would have been possible for them to have kept the family home and paid out their partner. This would have avoided the extra cost of paying stamp duty on the new purchase plus moving costs and further disruption to the children of the partnership.

My advice for anyone going through a relationship breakup where property is involved is:-

  1. Seek the advice of a trusted mortgage broker. These matters can take a long time to be sorted out and if you approach your Bank can you be sure you will be speaking with the same person each time you need assistance.
  2. Tell the full story about the financial situation no matter have embarrassing you might think it is. This is the only way a full assessment and advice can be given.
  3. Be prepared when you discuss your situation and have income details, family tax benifit amounts, maintenance payment amounts and details of all debts and monthly commitments.

I always say “you wouldn’t wish your worst enemy to go through a partnership breakdown but being informed gives you strength.”

If you or someone you know could do with a frank and honest discussion about their situation please call me  Kim Wight Mortgage Broker Sydney  on  0412 167 551 or email  I am here to help.

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How can I get a home loan when I am self employedMany  new clients ask me  ”How can I get a home loan when I am self employed?”  

As a self employed person you may find getting a home loan difficult as you tend to be caught up in two different dilemmas.

By this I mean you and your accountant try to minimize your taxable income by claiming every possible expense within your business, but in order to borrow money you need to be able to show the lender the maximum amount of disposable income available to cover future loan repayments.

While your accountant does this fantastic job of legally minimizing your taxable income, which is what you  employ them to do, your borrowing capacity is then reduced as the lenders base their decision solely on your taxable income.

I have to tell you a hard fact of life – “you can’t have it both ways” and you need to understand the borrowing process and have a strategy to achieve your financial goals.

Plan Ahead

If you are self employed and looking to get a home loan you need to plan ahead. While the method of getting a loan is the same for both self employed and PAYG borrowers the real difference is how the lenders will assess your income.

For a PAYG borrower they only need to provide payslips for a lender to verify their income but much more is required for a self employed borrower.

Most lenders will require your last two year tax returns for both the business and your personal income. By looking at the last two year’s returns they will average the income over that two year period. This will mean that if in the first year you were showing little income or perhaps even a loss and  then if you showed good income in the second year by averaging the two year’s your income your for borrowing potential will be reduced.

2014 taxable income  $25,000     2015 taxable income $60,000

Total for two years $85,000
divided by 2 = assessable income of $42,500

If you are planning on buying a home you need to speak with your accountant and tell them  and together with them and your finance broker a plan can be developed to have the maximum amount of taxable income declared to allow you to borrow the maximum amount of funds required.

Full Documentation Loans – Full Doc

By providing your tax years and financial statements when applying for a home loan while you might have paid more tax than you may have liked but you are saving $’000 long term as you will qualify for up to 95% of the purchase price of a property and also have access to any of the great discounted interest rates in the market place.

With full doc loans lenders will also allow for certain expense deductions to be added back to your income and increase your borrowing potential. These “add backs” can include depreciation, directors salaries, extra superannuation payments and one off capital expenses.

Low Documentation Loans – Low Doc

Before the GFC these loan were extremely popular with self employed clients as you could borrow up to 80 % of the property value and you did not need to provide any tax returns or financial statements. You simply made a declaration of your income and in the majority of cases you were offered discounted interest rates in line with PAYG clients.

Those days have gone!

Now if you are unable to provide tax returns you can still borrow up to 80% of the property value but you need to provide, in most cases, your BAS and trading statements to verify income. You also need to have held an ABN for a minimum of two years and be registered for GST if declaring an income above $75,000pa.

The Need for Bricks & Mortar

As a business person you may be thinking that you do not want to buy property but want to borrow for investment in your business. The fact is lenders want security for any money they lend you and they want bricks and mortar. Whether you have residential or commercial property you will be in the best position to borrow money if you have equity in real estate.

If you require a loan for business purposes some lenders will give you a loan on residential interest rates rather than commercial interest rates and over a longer term which may help with cash flow if you can offer them the security of a residential property.

Get Professional Advice

Researching all the various lenders  policies can be a minefield as some only want the latest year’s figures for a full documentation loan which may be better for you , some will accept an accountant’s letter for a 60% low documentation loan and the list goes on and on.

If you are thinking about getting a home loan I suggest you contact me and together we can navigate the various lenders rules and policies for your benefit

I have access to 25  different lenders and have the experience to advise you not only on interest rates and fees but also the various lender’s policies that might make the difference between you getting a loan or not.

I hope you have found this information useful and if you have any questions please contact me Kim Wight Mortgage Broker Sydney on 0412 167 551 or at

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