Australian Mortgage and Loan Information

CBA to increase fixed rate lock loans by 60 basis points!

Should I lock the rate on my home loan?
This is an interesting question, and given the recent press leaks from the experts on what we should be paying for our home loans, it seems rates are unlikely to go lower. Even the RBA seems to have joined the: rates have bottomed chorus, so we are likely at the bottom of low rate the cycle. So maybe it is worth doing your sums on a rate lock.

Check with a reputable mortgage broker what rates are on offer before you jump, you may be wise to kick your old bank to the curb and find a new lender.

The main benefit of a rate lock is certainty. You will at least know what you have to pay for the period of fixed rate you choose. You may also be getting a jump on the banks, as they are likely to increase rates further if they think the market will handle it.

The downside is if rates drop further. Check out the history of rates for the last fifty years.

And finally check your loan statements, banks make mistakes every minute, make sure you are not getting ripped off. Click here for more info on loan checking software.

Home Loan Mortgage Offset Account

A few extra dollars a month paid off your mortgage can result in substantial reduction in your overall payments and home loan term. However, if you have a good regular income and can save. Why not consider a home loan with a FULL offset facility. This quick and simple option helps you keep your financial eggs in slightly separated baskets giving you a lot more control over your financials.

How does it work?
A home loan mortgage offset savings account is simply a bank account linked to your loan account. The balance of this account is offset against the amount you owe on your mortgage. With a full offset account, you effectively only pay mortgage interest on the difference. On partial offset accounts, the offset may be only 50%. Check with your lender. Generally the features of this offset account are similar to a statement savings account, meaning you can come and go as you please, however some lenders require you to meet a minimum balance requirement.

Over time, savings in your offset account can help to reduce the loan principal, allowing you to pay off your loan sooner or build substantial equity.

Example: Obama and Michelle have a $500,000 mortgage and $100,000 in their linked 100 per cent offset account. The principal of their $500,000 loan is reduced by the $100,000 in the offset account to $400,000. As a result, interest only accumulates on the $400,000 balance of the loan. Obama and Michelle continue to make their normal repayments on their entire $500,000 principal and interest loan. Over a number of years, both the principal and interest on their loan are repaid faster. At the same time they have a savings account they can use for emergencies or for retirement planning.

If you don’t have this facility, find a lender who will work with you who does offer this feature.

Reputable Mortgage Broker

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.

Private sector house approvals fell 13.1% in December 2008 according to the Australian Bureau of Statistics.

Why is this good news? Less new dwellings being built, mean tighter supply and a probable increase in value for current stock, well that’s the theory anyway.

The reality is Australian home affordability is out of kilter with wages and incomes.
So instead of home ownership being right of all Australians, it is for now, an elite privilege.

I also see the Government’s tax revenue (It’s major income source) is down 19% for the September 08 quarter, yet it’s expense’s rose across the board. The Governments credit card is close to maxed out. Tax revenue will have to increase, or we may find the government shedding jobs. What will that do for property values?

My research into commercial properties has revealed the market to be dead in the water. Sellers are asking premium price, buyers in the main are adopting a wait and see policy.
Drive around a factory precinct near you, count the deserted properties. My gut feel is for a 50 to 60% drop in values for these properties shortly.

It is time to re-evaluate your banking, you want to cut fees, consolidate your debts, check out better deals, whatever saves you money. Get some loan checking software and use it to check your credit cards, business loans and home loans.

Government stimulus package and historically low lending interest rates will buy some time, but the risk of a massive correction in Australian house and commercial property prices is as high as it has ever been since the great depression. Over valued and in many cases in poor condition, Australian property has become decidedly on the nose internationally.

The International Monetary Fund has for some time voiced a considered opinion that: “Australian property is among the most overvalued in the developed world.“ International investors have heeded the IMF’s warning and are quitting their Australian holdings in the droves. New enquiries have all but dried up.

February 2009 is the perfect time to ready yourself for the turbulent time ahead. Consolidate your debts, sign your tenants to a longer lease, crack down on tardy payers. Repair and maintain your properties to keep them in top condition. Check your mortgage interest rate, get the lowest rate mortgage available or convert to interest only if you can and get some quality mortgage checking software.

Check your statements be careful with your id.

Internet Banking is an important tool for most home mortgage holders. You can keep track of your payments, withdawals and loan limits easily with just a click from your mouse, however with the growing band of online pirates targeting Australian Banks, online banking is getting very risky.

Along with the United Kingdom, Germany, Spain and the United States., Australia is one of the most targeted countries for identity theft in the world. The pirates are getting more numerous and more brazen by the minute, so please don’t think you are immune.

I recently became a victim of these pirates. Their scheme was simple: a pop up informed me I had malware and that for X dollars I could remove it and at the same time upgrade my current anti virus software for a discount price. I was sucked in as all the icons and info mirrored my current security provider. The Trojan program installed itself and made ready to steal my financial and identity information. Luckily I realised my error in a short space of time and was able to cancel the transaction and remove the malware.

A study conducted by AusCERT earlier this year found about one in six Australian home computers is compromised by malware. AusCERT stands for Australian Computer Emergency Response Team. The general manager of AusCERT Mr Graham Ingram stated recently: “Where once a web user had to click a web or email link to become infected, now a visit to a trusted site could deliver what is known as a “drive-by download”. “Their target I your personal data. The ability to impersonate someone gives thieves access to bank accounts and corporate secrets that can be used to even manipulate share prices.”

I don’t condone giving into the pirates, the convenience of internet banking is worth to much. All I can suggest is that you are vigilant and make sure you have a reputable anti virus like Norton 360 or
Pc-cillin and check your statements regularly for errors as well as for fraudulent transactions,

Home loan and mortgage holders are at more risk than ever of getting overcharged interest and fees by their lenders. Essentially, getting ripped off by their home loan lenders.

The reduction in staff and extra pressure on the remaining staff have increased the possibility that lenders will make mistakes on your accounts. With interest rates falling, there is an even bigger chance that the mistakes will be in favour of your lender.

Be vigilant with your credit and home loan statements. For some years now I have been using a PC based software package made here in Australia called Mortgage Watchdog.

Mortgage Watchdog software is easy to install and use. It also has the credibility for Banks and other lenders to authorise refunds based on its calculations.

If you have a current mortgage or you have been lucky enough to have paid one out recently, I suggest you check out your lenders calculations. Put Mortgage Watchdog on your Christmas list.

Has your bank overcharged you? – Download this mortgage software to check your interest charges and claim your refund today!

Hail the Reserve Bank Board for acting quickly and decisively on interest rates.

As a result and despite all the doom and gloom, bail out and prop up talk, property prices and auction clearance rates seemed to have stabilised.

Experts are predicting home loan rates are going to fall way below any previous historical low of the last fifity years. So, It is time to evaluate your current or proposed mortgage, or test “what if” scenario’s if you are considering refinancing or consolidating debt.

Loan calculators and other recourses available on the web can help you test these “what if’s”. And the best thing is they are generally free and flexible enough that you can do things like calculate the effect of interest rate rise and falls or compare loans. In most cases you can print out the results. If not then just print the web-page.

Most calculators are easy to use. Generally it is all a matter of putting your numbers in the boxes and then clicking on the calculate button. You can have a bit of serious fun just playing with them. I have gathered what I consider the best Home Loan Mortgage calculators below:

List of Calculators
Loan Comparison
Loan Payment with Amortization Schedule
Mortgage Consolidation & Refinancing
Variable vs Fixed Interest Rate
Debt Consolidation
Accelerated Debt Payoff
Loan Statement Mistake Finder

Has your bank overcharged you? – Download this mortgage software to check your interest charges and claim your refund today!

When the Board of Reserve Bank of Australia announce a rate cut, they are talking about a thing called the cash rate. The cash rate is the overnight money market interest rate. The overnight money market is where many home loan lenders source some of their money for home loan mortgage lending.

The recent cut of .75% in this rate should bring about further relief for home mortgage borrowers who have standard variable or market rate loans. This recent cut is the third in three months and now sees the cash rate at 5.25%. There is usually a gap of around 1.8 to 2.50% from the cash rate to the rate your lender may be charging you. This gap plus account keeping fees is your lenders profit. Historically home loan rates will take a week or so to come down. So check your next statement and remind your lender of the cut if they have not made the change.

When ever there is a change of interest rate, there is an opportunity for you lender to make a mistake with your mortgage interest figures. And unless you pick it up you could be adding years to your loan and be ripped off thousands of dollars. I implore you to get some mortgage checking software. Check all your statements including your credit cards.