Posts Tagged savings

Why Use a Mortgage Broker

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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.

Expertise
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. 

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

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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 kwight@smartline.com.au.

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Why waste money on an overpriced mortgage?

Why waste money on an overpriced mortgage?

Some good news to kick off 2015.

At the end of last year we heard a few economists suggesting that we could see further interest rate cuts by the RBA in 2015. It appears that the ASX futures market now agrees with this assessment.

As you can see from the chart below, the implied yield curve is showing a predicted 0.25% p.a. drop in March or April. A further 0.25% drop is estimated to occur toward the end of 2015.

The main basis for this prediction is the current environment where inflation remains low and stable, unemployment is slightly growing and economic growth remains subdued. These are all ingredients that lean towards a rate cut in normal circumstances.

Mortgage Broker SydneyWhilst a 0.25% cut does not seem like much, the following chart shows just how much this can save a borrower.

Mortgage Broker Sydney

As you know, my offer to conduct a “health check” on your loan is always on the table. Just shoot me, Kim Wight Mortgage Broker Sydney an email if you would like to check that your loan is still competitive. There are terrific deals to be had.

 

 

 

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

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Save on Lender’s Mortgage Insurance

Everyone wants to save money on Lender’s Mortgage Insurance when getting a home loan .  It can add $’000’s to your  loan

Well , one of our very well respected banks has released an amazing promotion which could save you on this extra cost.

It is a little known fact that certain types of professionals, such as bank managers or medical doctors, are sometimes able to have their mortgage insurance premiums waived when they have a deposit of just 10%.

This particular bank has offered that “professionals” discount to anyone that qualifies for their loans.

The savings can be in the thousands as you can see below:

Mortgage Broker SydneyIf you are in the market to buy an owner occupied property, and you have a 10% deposit, this is an extraordinary saving.

There are numerous terms and conditions for this product so please give me , Kim Wight Mortgage Broker Sydney a call to talk through your eligibility. 

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

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Why Use a Mortgage Broker

Mortgage broker Sydney

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.

Expertise
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 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 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.

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. 

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

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What is Happening with Interest Rates?

What is happening with interest rates . Could it be stable interest rates as far as the eye can see?

The mainstream financial media can be a strange collective beast. After predicting doom and gloom for the Australian economy for the last 6 months (as mining investment tapers off), the headlines were suddenly full of confidence yesterday when exports showed a strong lift for the quarter.

Disappointingly, as soon as there is the slightest hint of economic growth, the pundits start predicting interest rate rises.

So, as we often do, we have looked at what the real experts think of yesterday’s growth data. The experts that put their money where their mouths are. As at the close of business yesterday, the ASX futures market was predicting the next cash rate rise in September 2015 (14 months away).

Of course, the futures market can be wrong, especially if there is a world economic shock like a GFC, however, this ASX forecast is a long way from yesterday’s mainstream media predictions.

mortgage broker Sydney

 

 

Please give me, Kim Wight Mortage Broker Sydney  a call if you would like to know if your loan is competitive.

As home loan profit margins expand for the banks, discounts can become easier to negotiate. Put me  to work.  I  could save you plenty.

 

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

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SPEND MONEY TO MAKE MONEY

 

Most people will have heard the phrase “spend money to make money”. This is a variation on that sentiment.

With the recent RBA decision to hold the cash rate at 2.5% again, we now have a unique opportunity to make a simple but SMART financial decision.

.My first point is extremely important.

“Current interest rate levels represent enormous savings to borrowers”

At 5% p.a. a $300,000 mortgage will cost a borrower around $72,114 in interest over the first five years. That same $300,000 mortgage would cost around $102,149 at 7.00% p.a.. Note: 7.00% p.a. is the approximate average variable home loan interest rate over the last 15 years. This 2.00% discount represents a $30,000 saving over 5 years. Are you using this saving wisely?

My second point is even more important.

 “There has not been a better time to make additional repayments on your mortgage for 20 years”.

Let’s continue to use that example of a $300,000 mortgage. The normal weekly repayment would be approximately $372 based on a 30 year term at 5% p.a.

What happens when you spend an extra $100 per week ($472 instead of $372)?

1. You pay your home loan off 11 years faster.

2. You save $115,000 in interest compared to making the minimum repayment over 30 years.

The table below demonstrates the progressive power of paying an extra $100 per week.

Mortgage Broker

 

 

Now is the time to pay down debt more aggressively. Whilst interest rates are low they absorb less of your repayments. This reduced interest expense frees up more of your repayment to reduce your debt. Make hay whilst the sun is shining.

As always, I am more than happy to run through your personal numbers just  contact me Kim Wight Mortgage Borrower Sydney

Smart ideas require action.

 

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WHERE ARE INTEREST RATES HEADING?

The question on everyone’s lips is “Where your interest rates heading? The experts are predicting the RBA cash rate will remain steady for the medium term.

The chart below shows that this sentiment is shared by the futures market (which is made up of people that put money behind their analysis). The market is not expecting an increase in the cash rate until February 2015. Even then, it is only predicting a 0.25% increase.

This could mean a relatively long period of historically cheap variable rate home loans.

Mortgage broker sydneyWhilst variable rates are currently stable, fixed rates appear to be making a slight change for the better over the last few weeks. The chart below shows that fixed rates are actually heading south.

mortage broker

What is even more interesting in relation to fixed rates is the gap that is opening up between the major banks and their non major rivals.

The table below illustrates this point with some sample products from Smartline’s panel of 28 lenders.

“Compare the pair”. Someone with a $300,000 mortgage would be $900 per annum better off over the three year period simply by choosing 4.79% p.a. rather than 5.09% p.a..

 

 

mortage broker sydneyOne could be forgiven for thinking that the majors offer more bells and whistles than the non majors. That would however be a mistake. Some of these non major loans (listed above) even offer 100% offset or free redraw on their fixed rates.

The last point that we want to make today is that we are currently enjoying incredibly low interest rates. As time goes by, we appear to be taking this amazing situation for granted.

mortgage brokerWith variable rates around 5.00% p.a. it is not that difficult to find an investment property that provides you with a rental return that is greater than your interest cost.

There are a lot of reasons to be positive about the future in this terrific country of ours:

1. Rental yields are high and property values are stable

2. Unemployment rates are low whilst wages continue to grow, albeit modestly

3. Variable and Fixed home loan rates are at record lows (and appear to be staying that way in the medium term)

If you would like me to look at your mortgage or discuss your next property purchase, please just give me a call Kim Wight Mortage Broker Sydney or shoot me an email.

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WHAT IS A MORTGAGE BROKER? Or WHAT DOES A MORTGAGE BROKER DO?

 

Mortgage broker sydneyHi I am Kim Wight and I am a Mortgage Broker based in Sydney. Often when I am talking to people they will say “What is a Mortgage Broker?’’ or “What does a mortgage broker do?”

To explain my “job” cannot be done in a handful of words as simply saying I help people get the right home loan for their needs does not even starch the surface of what I do.

Mortgage Broker – one job, many roles.

When people are looking to get a home loan either to buy their first property, upgrade to a bigger home,  build, renovate or  buy an investment property they want to know if they can afford the repayments and they want to get the right home loan that is available to them.  This is where I start my role as a mortgage broker.

GETTING TO KNOW YOU

I will talk to you about what you are trying to achieve, ask questions about what your plans for the future regarding the property you are buying and also your personal plans. How you answer these questions helps decide what sort of home loan features you need such as redraw being available or an offset account.

DECIDING HOW MUCH YOU CAN BORROW

I will also ask about how much you earn and what savings you have along with what other financial commitment s you have such as rent, personal loan, and credit card limits as this information determines how much you can borrow and what is your maximum purchase price.

CHOOSING A LENDER

Once we know how much you can spend I will show you the loans available to you from a large number of lenders including all the major banks. Each lender has a different way of assessing how much they will lender you and also their credit policies can also be different regarding the type of property you want to buy. I have access to these policies so together we can work through your home loan options and you can choose the lender and loan product you want to use.

COMPLETE A HOME LOAN APPLICATION

Now that you have decided on a loan and a loan amount I will need some paperwork from you as evidence of income and savings and complete a home loan application and sent it to the lender of your choice.  I deal directly with the lender on your behalf and answer any questions they may have regarding the application.

LOAN APPROVED

Once I get formal advice from the lender that the loan has been approved I let you know and if it is a purchase I also advise your solicitor. I will then follow up the lender to make sure your mortgage documents are sent to you for signing and will go through these with you to make sure you understand them and they are signed and completed correctly.   I then send these back to the bank for checking and arranging the settlement of the loan.

 IS THAT THE END ?

No ! Once the loan has settled and you are in your new home or have your investment property, I am still around to answer your questions and keep you up to date in what is happening in the property and home loan market.

I will contact you once a year to make sure you are happy with your loan and let you know of any better interest rates on offer.

A COMMON QUESTION ABOUT MY SERVICE.  

The most common question people often ask is what fee I charge. The answer is simple $0. Nothing.

I am paid a commission from which ever lender you choose. There is no charge to you and the interest rates and products are the same as you would be able to get if you went directly to the lender.

If you  need to arrange a home loan or have any home loans questions call me Kim Wight Mortgage Broker Sydney on 02 95 94 5722 between 9am-5pm Monday to Friday and I would be happy to help you. When you call you will speak directly with me and will only have to tell your story once. 

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TIPS ON SAVING FOR A HOME LOAN

Saving for a home loanAs a Mortgage Broker in Sydney I am asked by many first home buyers’ tips on saving for a Home Loan deposit.  Many find it really hard to get into a savings pattern and I agree it is difficult but the reward is worth the pain of planning and doing without in order to achieve the Australian dream of home ownership.

Here is the advice I give to my clients.

Set a Goal Amount

The first step is to know how much you need to save. If you are buying a property for $400,000 you will need 10% deposit, $40,000. This amount should be enough to give you the minimum deposit required by the lenders and cover your solicitor’s fee and stamp duty.  Lenders Mortgage insurance will also be payable if you are borrow more than 80% of the property purchase price but we will talk about this later in this e book.

Set A Plan For Saving for A Home Loan

Decide how much you can save each month.  Remember   what you are trying to achieve, owning your own home, and decide how much you really want it. What are you prepared to give up to save more money?  Things to consider are things like restaurant meals, gym membership, holidays away, buying lunches when you can take leftovers from home, if you smoke give it up and save the money and the list can go on and on. Only you know what you can change in your lifestyle to save money.  Remember this is not forever just until you achieve your dream of home ownership.

If possible have the amount you want to save deducted from you wages and have it paid into an account that you will not use for everyday use.  By having an account with the sole purpose of saving for a home loan deposit you will have the ‘’buzz” of seeing the balance grow and grow getting you closer to your goal.

Set a Timeframe

Commit to a date that you want to have the deposit saved and apply for a home loan.  This date needs to be realistic. It is no use setting it for 4 months’ time if you do not have the income to achieve that time frame.  By setting dates you will be more focused on reaching your savings goal and know there is an end date to some of the personal sacrifices you are making to save the deposit.

Next Step

Once you have saved the deposit we can then look at your home loans options and discuss your personal circumstances to make sure you have a home loan that fits in with your future plans.

If you want to discuss your plans for home ownership give me a call Kim Wight Mortgage Broker Sydney on 02 95 94 5722. 

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