Australian Mortgage and Loan Information

Basic Variable Home Loan.

Basic Variable Home Loans are generally the most inexpensive home loans available. They are inexpensive as they generally do not have all the bells and whistles that Banks and other Lenders add to their more profitable products. A Basic Variable Home Loan will suit most home buyers. Especially if you are the kind of home buyer who likes to pay their debts off quickly.

A Basic Variable Home Loan will provide you with the absolute essential for Home Ownership. It will provide the money to help you purchase your property. The maximum you can borrow is generally up to 95% of the purchase price of the property subject to a lenders valuation. Some lenders will lend up to 105%.

Your Basic Variable Loan will most possibly be a Principle and Interest Term Loan for a period of 1 to 30 years. Principle and Interest means that your payments will pay off both the interest the Bank or Lender charges for your loan and some of your original loan amount. Some progressive lenders will allow a period of say 10 to 15 years of interest only. Interest only is an important feature.

Most Basic Variable Home Loans also offer you a redraw facility at a certain level, internet and phone banking access, loan increase availability, no early repayment fee, unlimited extra payments and choice of payment frequency.

Another important feature offered by many lenders is a full offset account. This is a very worthwhile feature and can help you pay off your mortgage more quickly.

These Basic Variable Home Loans have a lot to offer no matter what the direction of home loan interest rates. They are worth considering for both refinance or purchase.

A Seat On The Fence For RBA Governor

Minutes of the Reserve Bank of Australia’s February board meeting, released 18th March 2009, show the Banks governor Mr Glen Stevens taking a seat on the fence rather than make a recommendation regarding interest rates.

The Governor decided to offer a choice between a rate cut or a wait and see approach to see the results of previous cuts. Thank goodness the board decided on the wait and see!
Home Loan rates are already at historical lows.

My opinion is documented in a previous post. Australia must maintain relatively high interest rates in comparison to our trading partners to encourage investment and the flow of foreign capital to Australia.

This wait and see period is the ideal time to consider your property investment strategy. If all the international economic bodies are correct, Australian property values are overdue for a correction. Many predict a drop of upwards of 30%. Now! may be a time to take profit. Especially in the lower or first home buyer areas.

Get an up to date valuation on your properties. Check which properties are paying their way. Get rid of the dead wood and prepare to take advantage of a new wave of property bargains as the recession starts to hit home.

Once again, the popular media is full of claims that many home loan statements contain massive calculation errors. They say the simple mistakes banks and other lenders make are costing home loan borrowers big time. Incorrect date on entries, wrong interest rate, doubling up on fees and missing deposits seem to be the main culprits.

I feel like shouting at the TV when this stuff rears its head again. Get yourself some loan checking software please.

The software has been seen on…
A Current Affair
Money
7:30 Report
4 Corners
Today Tonight

If you don’t want to check your statements, be aware you may be paying a lot more of your hard earned cash to the bank than you need to. For goodness sake keep a close eye on your home loan statements.

The Reserve Bank of Australia will release it’s latest move on Interest Rates today.

I for one, for the sake of the country, hope they leave them alone this month. Our Banks have just suffered a credit rating markdown, making it more expensive for them to borrow overseas. Australia needs to attract overseas money and what better way to do it than an attractive interest rate?

Our housing loan lending rates are already at historical lows, please leave well enough alone RBA.