Tips, Guides & Calculators

Tips & Guides | Calculators

Tips & Guides

Interest rate information

When getting a loan you need to seriously consider what type of interest rate best suits your needs, ie fixed rate vís variable rate. Before deciding ask yourself the following questions:

  • Do I want certainty in knowing what my interest rate will be (and therefore repayments) in 1, 3 or 5 years time?
  • Do I want to make lump sum repayments to my loan?
  • Do I want to be able to redraw on the advance payments that I have made on my loan?
  • Do I want to implement the benefits of a 100% offset bank account?
  • What are the industry experts predicting as the future of rates?
  • How long do I believe I will Ďholdí the property Iím purchasing?

By answering these questions you will go a long way in determining what type of interest rate best suits your needs. Always remember you can choose a ĎCombo loaní! For more information on Combo Loan, click here.

Tax tips for Investment Property Purchase

Before purchasing an investment property, itís crucial that you see a qualified accountant to asses your personal situation and determine how investment property ownership will affect you. Some of the issues to consider include:

  • Affordability in owning an investment property?
  • Who will own the property? i.e. both husband and wife or just the husband/just the wife
  • Do you know the pros and cons of Company ownership vís personal ownership?
  • Negative gearing benefits whilst holding the investment property
  • Who will the borrower/s be?
  • Do you know the rental return from the property?
  • Will you manage the property yourself or will an agent manage it on your behalf?
  • Are you aware of tax deductible expenses in owning an investment property? Improvements vís repairs.
  • Are you aware of depreciation benefits? Make sure you get a Depreciation Schedule!
  • Capital gains implications of when you sell the investment property.

Choosing a property/Buyers Checklist

Buying a property will probably be the most expensive purchase you will ever make. As a result you must seriously consider what you are about to do and ensure that you are 'armed' with all the necessary information required to make an informed decision.

Points to consider:

  • What is my borrowing power? Does this match with where I want to live and the type of property I want to live in?
  • What can I afford to repay on a loan?
  • What surrounding infrastructure does my lifestyle require? ie Transport, shopping, education, major roadways, medical & employment.
  • Will the property fulfil my future needs or are you only concerned with right now? ie: size of property
  • Do I want a new property or am I prepared to renovate?
  • Do I want established or do I want to build?
  • Do I want a house with a yard or an apartment?
  • Have I researched the surrounding suburbs and property selling prices? Relatively inexpensive data can be purchased from the Valuer Generals Department (visit www.landgate.wa.gov.au)
  • Is the area Iím looking at likely to appreciate in the future?
  • How has the area historically appreciated? ie am I buying at the peak?
  • Does the local council have future plans for the particular street or suburb?
  • Will my existing furniture fit?
  • Have I visited the property at least 2 times and taken photos/video?
  • Do all property improvements comply with council requirements?
  • Should I get a structural report? (Mortgage and Finance strongly recommends that you do!)

What are the associated costs in purchasing a home?

There are a myriad of associated cost in purchasing a home! Outlined below are some of the costs that a borrower may need to pay.

  1. Stamp duty on the transfer of the title of the home or block of land into your name. However, in Western Australia first home buyers receive a stamp duty exemption based on the criteria below:
    • House up to $500,000 purchase price the borrower pays $0 stamp duty
    • Land up to $300,000 purchase price the borrower pays $0 stamp duty.
  2. Settlement Agent Fees are another fee that the borrower will encounter. Settlement agents will manage the conveyancing of the property through to settlement. There is a standard schedule of fees depending on the price of the property, but the fees are negotiable due to the competitive nature of the industry.
  3. Transfer Registration Fees is a Government fee a borrower must pay to register the "Transfer of Land".
  4. Water and Shire rates are payable in advance and they generally come due July/August each year. Hence, you are paying rates for the forthcoming year. Depending upon what time of the year you buy will dictate how much you reimburse the vender of the property.
  5. You should always leave a little aside for miscellaneous expenses such as insurance (home and contents), moving expenses (if required), getting the telephone connected (if required) plus any other little expenses that may pop up.
  6. Lender Application Fee may be charged to you. If the lender of your choice does charge a fee it would cover such expenses as:
    • Lender Establishment Fee
    • Valuation Fees
    • Documentation Preparation Fee
    Mortgage and Finance would recommend for you to leave approx $700 to cover the above fees. Remember some lenders do not charge an establishment fee.
  7. Mortgage Registration Fee is made up of various sub fees that approximately amounts to $100.
  8. Loan Stamp Duty is another Government Fee
    • Home loans: Range from $20 up to $16,000 and $.0125 per $100 thereafter
    • Investment Loans: Expect to pay $0.20 per $100 of the Investment property loan
  9. Mortgage insurance is another fee that you may pay. Generally, insurance is required on your loan if the lender advances you greater than 80% of the purchase price. The insurance policy protects the bank should the borrower default on the loan and the lender can not recoup enough from the sale to payout the loan. The insurer will payout the shortfall from the lenders and then attempt to extract those funds from the borrower.

Pre-approvals

Why wait until you find a property before you start organising finance. At Mortgage and Finance, we strongly recommend that you get your finance approved in principal, (a pre-approval), before you go shopping for your home.

Why get a pre-approval?

  1. Your financial situation is assessed and any issues that may arise are sorted out prior to you contracting to buy a property.
  2. Pre-approvals last 3-6 months
  3. There is no cost to you! Neither the lender or Mortgage and Finance charge a fee to arrange pre-approvals.
  4. Vendors and Real Estate Agents love dealing with purchasers who have pre-approved finance
  5. Having pre approved finance may enhance your bargaining position when negotiating on the purchase of a property. Especially, in the case where there are other purchasers who are also interested in the same property as yourself.
  6. With pre-approved finance, once you find a property, the time frame in settling the property can be shortened considerably.
  7. Pre-approvals do not obligate you to purchase a property.
  8. If your pre-approval expires and you have decided not to purchase a property, neither Mortgage and Finance nor the lender will charge you a fee.

So you have to ask yourself, why wouldnít I get a pre-approval???

Feel free to contact us today to discuss with no obligations.

Why use Mortgage and Finance?

1. We offer you 1000ís of home loans options

We have access to over 35 different banks, building societies and non bank-lenders to give you the best possible finance solution. Our brokers are continually informed on each product from each lender. Donít go straight to the bank as you will be limited to the bank's own loan products; contact us for a full product suitability assessment today.

2. Our service will save you time

The never-ending paperwork, continual researching to compare the best loan products can all cause unnecessary stress on an already stressful situation. Our brokers deal with lenders everyday and can take all the stress away in getting your loan approved.

3. Our client is our number 1 priority

Finding the most suitable loan for each client is our number 1 priority. No matter if you are a first home buyer, investor or self employed, whatever the case may be we can help you find a loan that is right for you.

4. A free service thatís available 7 days a week

As well as doing the hard work for you we can meet you 7 days a week at no cost to you!

Want to speak to a Mortgage and Finance Finance Consultant?

If you are ready to take the next step towards finding finance or if you need further information please contact us to speak to one of our friendly consultants.

How can a Mortgage and Finance Broker help you?

Mortgage and Finance not only guides you through the steps in applying for a home loan. We see you through to final settlement on your home or investment property and beyond. Even once your loan has settled, our goal and objective is still to be your number one call for all your future lending requirements.

Step 1: Providing the supporting documents

At our first appointment, our brokers will outline each stage of your loan application and the required documentation to ensure the whole process runs as smooth as possible.

Step 2: Working out how much you can afford to borrow

It is crucial to any loan applicationís success that the amount you borrow is based on your current financial situation. Our brokers are fully qualified and experienced to calculate your affordability ensuring itís realistic and manageable.

Step 3: Find the best home loan to suit you

Every situation is different when assessing borrowing capacity and with 1000ís of different products, itís difficult for anyone to analyse the best product to suit their situation. Thatís why, Mortgage and Finance Consultants are kept up to date with latest news on the different loan products and features available on the market. Mortgage and Finance Consultants are knowledgeable and qualified to provide you with a range of loan options to suit your needs. Also, when structuring your loan a Mortgage and Finance Consultants will also take into account your plans for the future, ensuring that your loan suits your needs now and into the future.

Once you have chosen your loan, we will also help you complete the lenders paperwork and organise the supporting documents. Once these documents have been submitted, our brokers will be constantly updating you on the progress and are available at any stage if you have any questions.

Step 5: Choosing a Settlement Agent

Its now time to find a settlement agent. If you need any recommendations, Mortgage and Finance can provide you with details of reputable and reliable contacts.

When you have found your property or purchase, a pre-approval will be provided and contracts are exchanged.

Step 6: Settlement Day

Once your loan is settled, the property will be transferred into your name.

So you have to ask yourself, why wouldnít I get a pre-approval???

Feel free to contact us today to discuss with no obligations.

Calculators

Monthly Repayment

Mortgage Refinancing

Fortnightly Repayment