The PRWIRE Press Releases https:// 2019-05-07T06:11:45Z RBA tentatively holds cash rate 2019-05-07T06:11:45Z rba-tentatively-holds-cash-rate The Reserve Bank of Australia (RBA) has once again made the decision to leave the nation’s official cash rate (OCR) unchanged at 1.50%.   Mortgage Choice franchise owner Scott Partridge said, “A change to the cash rate, less than a fortnight out from the federal election would have been a remarkable decision from the Reserve Bank, even though financial markets have fully priced in a rate cut to occur in the short-term.   “Moreover, history shows us that the fiercely apolitical RBA does not move on the cash rate in the middle of an election campaign for fear of making monetary policy a political football,” said Mr Partridge.   Mr Partridge said domestic economic factors such as inflation data play a key part in the Bank’s decision. “The March quarter Consumer Price Index (CPI) revealed a disappointing underlying inflation rate and a flat headline read throughout the quarter. This weak inflation reading, below market expectations, has been the case for nine out of the last ten quarters and means inflation is unlikely to hit the RBA’s target range of 2-3% by the end of 2019.   “In the minutes of the April Monetary Policy Meeting, the RBA highlighted the economic circumstances which would make a valid case for a rate cut such as flat inflation and unemployment trending up. Despite consistently lacklustre inflation, the unemployment rate remains at near historic lows,” said Mr Partridge.   The most recent Labour Force data from the Australian Bureau of Statistics (ABS) revealed a seasonally adjusted unemployment rate of 5.0% in March, which is near historic low levels.   The CoreLogic Hedonic Home Value Index revealed that the rate of decline of national dwelling values continues to ease, recording a 0.5% fall in April. This was attributed to the easing of the market downturn in Sydney and Melbourne, however the index showed that dwelling value falls have become more geographically widespread across the country.   Mr Partridge said, “A weaker housing market is good news for those looking to buy their first property. This, coupled with the fact that home loan interest rates are hovering at historic lows, presents great buying opportunities for those looking to realise their property ownership goals this year.”   Mr Partridge urged those looking to secure a loan to closely monitor their living expenses and create sound financial habits from today to increase the chances of having their home loan application being viewed favourably.   “Borrowers who wish to secure their first home loan, or may be looking to refinance their existing loan, should speak to their local mortgage broker to ensure they are in the right financial position to submit a successful loan application,” concluded Mr Partridge.   ENDS   Mortgage Choice 2019 Federal Budget Analysis 2019-04-03T07:26:58Z mortgage-choice-2019-federal-budget-analysis After over a decade in the red, the 2019 Federal Budget is back in black and will deliver a surplus of $7.1 billion next financial year, Treasurer Josh Frydenberg announced last night.   Mortgage Choice franchise owner Scott Partridge said, “Mr Frydenberg has handed down what many are describing as an ‘election year’ budget”.   “However, Australians are well aware that the likelihood of these budget initiatives are subject to the Coalition winning the upcoming Federal election, which is due to be called in a matter of days”.   Personal Tax Cuts The winners to come out of the Federal Budget are low and middle income earning Australians who under the Coalition will see personal tax cuts amounting to $1,080 a year for individuals and $2,160 a year for dual income families. These tax cuts have largely been achieved through the low and middle income tax offset pledged in last year’s Budget, which are due to take effect from 1 July 2019.   The offset will be available for the 2018-19, 2019-20, 2020-21 and 2021-22 income years. After allowing for the tax cuts announced in last year’s budget, the tax savings will have the following impact:   $18,201-$37,000 – Tax relief of up to $255. $37,001-$48,000 – Tax relief between $255 and $1,080. $48,001-$90,000 – Full tax relief of $1,080. $90,001-$126,000 – Tax relief gradually reduces from $1,080 to $0. Over $126,000 – No tax relief in the current Budget. Last year’s Budget delivered a modest tax cut of $135.   “These tax cuts may be modest but for Australians feeling the pinch of higher living costs the extra cash can be put into your mortgage to reduce the principal and interest payments; or it can boost your savings and go towards your deposit for your first home,” said Mr Partridge.   Infrastructure boost and the housing sector Mr Partridge said, “Unfortunately, this was not the Federal Budget for homeowners or the property sector as no initiatives were announced that provide direct stimulus to the property market. That being said, policy measures which improve infrastructure can have a positive long-term impact on housing affordability.   “The $500 million fund to invest in car parks at train stations will reduce traffic, allow for more affordable commutes and significantly reduce travel times to metro centres across the country.   "The Budget also includes $3.5 billion for the first stage of the Western Sydney Rail North South Rail Link and $2 billion for fast rail from Geelong to Melbourne.   “With the current softening in property prices this investment may have a positive double whammy effect for working families who can achieve a better work life balance and increase their chances at achieving the Australian dream of owning a house on a quarter acre block,” said Ms Mitchell.   Small business owners The popular instant asset write off for small businesses has been extended until June 30, 2020. The write off was used by over 350,000 small businesses across the country last year, which has led the government to announce an increase to the threshold from $25,000 to $30,000. In addition, write off has now been extended to medium-sized enterprises with a turnover of up to $50 million.   Around 3.4 billion businesses employing around 7.7 million workers stand to benefit from the instant asset write off, which may serve to stimulate the economy.    Encouragingly, it is no longer limited to a single purchase, which means small business owners will be able to claim the write off each time they purchase an asset under $30,000.   Superannuation The Treasurer also announced more superannuation tweaks that allow Australians to contribute more to super, and for longer.  From 2020-21, 65 and 66-year olds will be able to make voluntary superannuation contributions without meeting the current work test.   The same demographic will be permitted to make three years’ worth of non-concessional super contributions, currently capped at $100,000 annually. At present, only under-65s can access this arrangements. The age limit for spousal contributions will be raised from the current level of 69 to 74 years.   These build upon the existing Superannuation policy brought in from 1 July 2017, which placed a $1.6 million transfer balance cap on the total amount of accumulated superannuation an individual can transfer into the tax-free retirement phase. The transfer balance cap is indexed and will grow in line with CPI, meaning the cap will be around $1.7 million in 2020-21.   Conclusion “All in all, this was a Federal Budget to appeal to the masses and to neutralise some of the benefits that voters would gain under Labor. Now it’s up to the Australian public who go to the polls next month to decide if this Federal Budget will become the country’s new economic template from which to drive sustainable growth,” concluded Mr Partridge..  ENDS RBA’s stalemate nearing its end 2019-04-02T04:59:49Z rba-s-stalemate-nearing-its-end The Reserve Bank of Australia (RBA) has today made the decision to leave the nation’s official cash rate (OCR) unchanged at 1.50%.   “RBA board members have held the nation’s cash rate yet again, however a range of economic factors are likely to encourage the bank to cut the rate,” said Mortgage Choice franchise owner Scott Partridge.   “The OCR’s function as an anchor to lenders’ interest rates shifted over 2018, as lenders were forced to respond to higher funding costs. Moreover, markets are pricing in a 90% probability of a rate cut by August this year, adding further pressure on the RBA to change its long held stance on monetary policy,” said Mr Partridge.   The RBA considers a range of global and domestic economic factors when making its monetary policy decisions. At its March meeting, the US Federal Reserve took a dovish stance on monetary policy, opting to hold the Fed funds rate at 2.25-2.50%. A rate hike was expected by the Fed, however comments from Chairman Powell points to no increases in the near-term due to ongoing economic expansion in the US.   In the minutes of the March Monetary Policy Meeting, RBA board members noted that trade tensions continue to weigh on the global economic outlook. Members noted that in Australia, labour market conditions had continued to improve. The RBA continues to monitor the weakening housing market, drawing attention to Sydney and Melbourne, where dwelling values had fallen 13% and 10% respectively, since their peaks.   The most recent CoreLogic Hedonic Home Value Index revealed that national dwelling values fell by 0.6% over March and have fallen by a cumulative 7.4% since peaking in October 2017.   The most recent data from the Australian Bureau of Statistics revealed that the number of dwelling commitments to owner-occupiers fell 2.6% over January 2019.   Furthermore, National Australia Bank’s most recent Monthly Business Survey points to deteriorating business confidence. Similarly, the Westpac Melbourne Institute Index of Consumer Sentiment revealed the weakest consumer mood since September 2017.   Mr Partridge said today’s strict lending practices, born out of lenders’ self-imposed tightening in the wake of the Banking Royal Commission, continues to play a part in the slowing property market. This places greater importance on the need for future home buyers and borrowers alike to get in shape financially.   “The slowdown in the nation’s economic growth would also be of concern to RBA board members, with recent GDP data revealing a slowdown in growth due in part to declining dwelling investment.   “In the current lending environment, my advice to borrowers would be to speak to a mortgage broker to ensure their home loan applications are as tight as possible. The reality is that lenders are going to call out any and all undeclared living expenses on home loan applications, significantly lengthening the time to approval.   “Preparing for a home loan application today is not as simple as saving for a deposit. The high level of scrutiny by loan assessors means prospective buyers, and those looking to refinance their loans, should be: cutting back on discretionary spending at least six months ahead; closing credit cards that are no longer being used and reducing limits where possible; and knowing where they are spending every dollar.     “The good news for those with property ownership aspirations is that lenders are aggressively competing for low risk borrowers, which means it’s a great time to learn what your options are.   “If you are looking to apply for a home loan this year and need to get home buying ready, speak to your local Mortgage Choice mortgage broker. A broker will assess your financial situation in the same way a lender would and give you a clear indication of your borrowing power.  When the time comes your broker can help you prepare a home loan application that has the best chance of being viewed favourably by the lender you choose,” concluded Mr Partridge    ENDS RBA holds the cash rate again, but for how long? 2019-03-05T05:48:40Z rba-holds-the-cash-rate-again-but-for-how-long The Reserve Bank of Australia (RBA) has today made the decision to leave the nation’s official cash rate unchanged at 1.50%.   “RBA board members have made the decision to hold the cash rate once again, but there is mounting speculation that there may be as many as two rate cuts this calendar year,” said Mortgage Choice franchise owner, Scott Partridge.   “Throughout 2018, the lending landscape was shaped by an increase in wholesale funding costs, which saw some lenders raise rates and lending standards tighten, resulting in a significant reduction of applicant borrowing power. It was also revealed by the ACCC that opaque mortgage pricing makes it difficult and time consuming for borrowers to shop around and stifles competition on price.   “In recent years we have seen the relationship between lenders’ pricing on home loans and the official cash rate become less aligned.   “Where borrowers are concerned, it is no longer reasonable to assume that changes in the cash rate, or lack thereof, will drive home loan interest rates.  “At a Standing Committee on Economics in February, RBA Governor Lowe highlighted the importance of borrowers seeking a better deal on their home loan, drawing attention to the discounts on headline interest rates that lenders are willing to give borrowers. “Interest rates are constantly changing and the rates you see advertised can be significantly higher than the rate you could secure. It would be a full-time job for borrowers to stay abreast of all these changes. Luckily, they don’t have to. "Your local mortgage broker knows the lending policies and preferences of a wide range of lenders and may be able to negotiate a competitive interest rate for you.   “In this increasingly complex environment, it’s no surprise that more Australians are turning to their local home loan experts who can offer them choice and save them money and time. In the September 2018 quarter, broker market share surged, with 59.1% of loans originating through the broker channel, highlighting the value mortgage brokers bring to borrowers,” said Mr Partridge.    “Throughout most of 2018, the RBA signalled that the next cash rate move would likely be up, however its tone seems to have shifted.   “Whether the cash rate changes or not, the reality is we are living in times of unprecedented change in the lending landscape. Borrowers should keep a home loan expert in their corner, who is prepared to fight for them to secure a competitive deal on their mortgage.   “If you are a borrower looking to switch from an interest-only loan to principal and interest, or coming to the end of a fixed-rate period, now is the right time to speak to your mortgage broker.   “My advice for anyone wanting to buy their first home is to establish a relationship with their local broker, who can help them navigate this complicated lending environment and get them in the right financial position to apply for a home loan,” said Mr Partridge.  The RBA’s decision A number of domestic and global economic factors would have played a role in the RBA’s cash rate decision. In the United States, the Federal Reserve made the decision to hold the Federal Funds Rate at 2.25-2.50% at its last monetary policy meeting. Factors such as a slowdown of the US economy and global political uncertainty may be encouraging a cautious approach from the Fed.   While at home, RBA board members are paying close attention to the nation’s housing market activity and have lowered their outlook for dwelling investment. In the minutes of the RBA board’s previous monetary policy meeting, members noted the fall in demand for home loans, particularly among property investors.   Mr Partridge said, “There is irrefutable evidence that the heat has come out of the Australian housing market, particularly in Sydney and Melbourne.”   National dwelling values recorded a 0.7% decline in February according to the CoreLogic Hedonic Home Value Index.    Further, the RBA’s most recent financial aggregates revealed that housing credit growth recorded its slowest rate of growth on record, and January 2019 data revealed the smallest monthly increase since July 1984.   Mr Partridge said, “The upside to falling property prices is that there are many deals to be had for those looking to buy a home.”   According to CoreLogic, 75% of properties which sold at private treaty over January 2019 sold for less than the original list price. Further, in the nation’s capital cities, the median vendor discount is at its highest level since 2009.   Other factors which would have played a part in today’s monetary policy decision today include a lacklustre inflation rate. The latest data on inflation revealed a headline inflation rate of 1.8%.   The Australian Bureau of Statistics’ Labour Force Survey, revealed the nation’s unemployment rate was 5.0% in January. At the same time, the Wage Price Index revealed a moderate lift in the December 2018 quarter but is forecasted to remain sluggish.   Furthermore, the most recent National Australia Bank Monthly Business Survey revealed that business confidence remains below the long-run average, while business conditions recovered slightly in January after a sharp fall in December.   Additionally, the Westpac Melbourne Institute of Consumer Confidence revealed that consumer sentiment rose in February after disappointing results in January. The ‘cautiously optimistic’ consumer was attributed to weak views on family finances and Australia’s deteriorating house prices. What is the difference between a Construction Loan and a Regular Home Loan? 2019-02-11T04:02:56Z what-is-the-difference-between-a-construction-loan-and-a-regular-home-loan Custom building your own home and tailoring it to you and your family is one of the most exciting ways to own your own home. You get to decide on the number of bedrooms, bathrooms, living spaces, tiles, colours and more. And just like finding the right builder to help you make your dream come true, you need to find the right construction loan to give you peace of mind. So, what exactly is a construction loan? A construction or owner builder loan is a type of home loan available specifically to people who are constructing a new home or making major renovations, rather than buying an existing property. There are a few differences between a construction loan and a regular home loan – the major one being the structure of the construction loan – which can be very valuable if you are building a new home. Not all lenders will offer construction loans, and sometimes if they do, it can be a limited range. That’s why speaking to Scott from Mortgage Choice in the Hills, who has access to a wide range of loans and lenders, is recommended when trying to find the right construction loan. Construction home loans vs regular home loans Luckily, for all of you thinking of building a new home, construction loans are set up specifically to benefit you. A regular home loan would mean that the total funds will be available in a single lump sum, so you can make a property purchase. With a construction loan, borrowers are able to receive the loan amount in ‘progress payments’, or stages, as your new build is completed. This is a fantastic structure for new home builders, because you will only be asked to make interest repayments on money that has actually been paid. This means you will only be paying interest on money that has been used to finance the build to date, and will increase gradually as your home nears completion. Your lender will have some requirements There are a few things to keep in mind with a construction loan. While progress payments are fantastic for new home builders, a lender usually sets a maximum timeframe for the complete draw down of your loan – which usually sits at about 6 months. To avoid paying interest on the whole amount before you’ve even decided on what you want, make sure you have everything lined up and ready to go before applying. Interest rates for construction are generally variable, and often have a maximum Loan to Value Ratio (LVR) of 95%. That rate does vary depending on the lender, and another great reason to speak to Scott about your construction loan. How do the progress payments work? Once your construction loan has been approved and the build is underway, your chosen lender will make payments throughout each stage of construction. The scheduled stages of the build are usually: Slab stage: This is the amount you need for the builder to prepare the foundations and lay the slab for your property. This progress payment might be a big chunk of the total loan amount depending on if you need the ground levelled or waterproofed, etc. Frame stage: This is the stage at which your home really starts to take shape, and includes enough for the builder to complete the frame of your new home, and also includes some brickwork and windows. Lock up stage: Once your new home is at lock up stage, it means that all external walls, windows and doors have been complete – meaning your property is now ‘lockable’. Fit out stage: This progress payment covers the fit out of your new house, including the cupboards, benches, plumbing and electricity. It also means that your house is nearly completed! Completion stage: This is the amount for the conclusion of all the contracted services for your new home including final plumbing, electricity and overall cleaning. The construction loan process The process for a construction loan is not too different from a regular home loan, but knowing more about the process can help you know exactly what to expect, and what the next steps are. Application: Just like with a traditional home loan, your lender needs to have a look at your income and savings, what you spend and your capacity to repay the loan. However, with a construction loan you also need a few additional documents such as a fixed price building contract, building plans approved by council and a copy of your builder’s licence. Having to provide these additional documents is a great way to double check that you’re ready to go and you have got your bases covered. Progress payments: Once the loan is approved, the progress payments will begin as the build commences and progresses to completion. Your home is complete: Before making the final progress payment to your builder, your chosen lender will inspect the property and require a few last documents for the final valuation. Once the final progress payment is complete and your builder has been paid, your loan will switch to the standard home loan that you agreed on with your lender. You can move in: Pop the champagne and organise the house warming. You are free to move in and get settled in your new home. Congrats! Construction loans is the right tool for the job Construction loans offer people building a new home a lot of benefits. The structure of a construction loan will help you hold off on making interest repayments on a loan that you don’t necessarily need yet – saving you money in the long run. Mortgage Choice in the Hills have a range of great construction loans available, from our panel of over 20 quality lenders. Talk to us today on 02 9653 9333, email: scottpartridge@mortgagechoice.com.au or or click HERE to book a time to discuss financing your dream home. The Necessary List 2019-02-11T03:47:15Z the-necessary-list We try on shoes and clothes to ensure they fit, feel comfortable and are appealing.  What about doing the same for a new home?  It's the largest investment your likely to make, so isn't it important to 'try on' a home before buying it? It's not surprising that we look for a home in places that are convenient to work, public transport or schools, so why not take the routine activities of family members into account too? Make a List of what Matters to You .... then go shopping! Look at a lot of houses.  After you viewed each one, have a talk about how it measured up to the list.  No doubt, after a few inspections, you may vary the list as your experience of what's new and available grows. Don't be sidetracked by 'shiney' objects, like a brass bed, some wicker, lots of healthy house plants, and a few trendy pieces of furniture - nowadays houses are staged for inspections to make them more appealing.  Admire what's been done with the house, but the furnishings and decorations will go when the vendor goes! Remember when you look at a house, you get the bare bones and not all the frills.  Knowing what's important to you can save you costly mistakes.  The process of 'trying on' a house helps you evaluate what's important.  You'll find it's worth the effort. It's also a good idea to secure a pre-approval prior to commencing your property search so you know how much you've got to invest.  This is particularly important if you are considering bidding at auction. Mortgage Choice in the Hills can help you with all your home loan needs.  We have a range of great home loans loans available, from our panel of over 20 quality lenders. Talk to us today on 02 9653 9333, email: scottpartridge@mortgagechoice.com.au or or click HERE to book a time to discuss financing your dream home. RBA wraps up 2018 where it began 2018-12-04T10:24:48Z rba-wraps-up-2018-where-it-began The Reserve Bank of Australia (RBA) has today made the decision to keep the nation’s official cash rate on hold at 1.50%, closing out the year in the same cash rate position it adopted in August 2016.   “Governor Lowe continues to anchor the cash rate at 1.50%. However, despite over two years of a stagnant cash rate, some borrowers have seen their mortgage interest rate rise whilst lenders have adopted stricter policies and criteria, creating one of the most complex lending environments in recent memory,” said Mortgage Choice Franchisee Scott Partridge.   “This tightened lending environment, means a larger number of Australians are experiencing difficulty securing a home loan due to new, stricter assessment criteria in which their savings and living expenses are being forensically examined.   “That being said, those who present less risk are able to negotiate a more competitive home loan deal with lenders, who are competing vigorously for financially fit borrowers.   “Looking ahead, borrowers should not be complacent, as securing a home loan in 2019 may become increasingly complex. This highlights the need for borrowers to get their finances in order and seek expert advice from a qualified mortgage professional, who can guide them through the process and offer a choice of lenders.” said Mr Partridge   The RBA’s decision   A backdrop of positive economic data is continuing to support the Bank’s accommodative stance on monetary policy.   The latest National Australia Bank Business Survey revealed that business conditions remained well above average in October, with conditions highest in mining and lowest in retail.   The Westpac Melbourne Institute of Consumer Sentiment revealed that consumer confidence had undergone a clear improvement over 2018. Respondents were much more positive about their own finances, due in part to a sustained period of low interest rates.   The most recent Hedonic Home Value Index from CoreLogic revealed that national dwelling values fell by 0.7% over November, led by 1.4% and 1.0% falls in Sydney and Melbourne respectively. Nationally, dwelling values were down 4.2% since peaking in October last year. This follows several years of strong growth in dwelling values and can be attributed to measures implemented by Australia’s financial regulators in recent years. The decline in dwelling values, particularly in the nation’s capitals could open the door to those looking to get their foot in the property market.   Encouragingly, the most recent Labour Force survey from the Australian Bureau of Statistics revealed an unemployment rate of 5.0% in October and the nation’s participation rate is close to record highs, which could be a positive indicator for wage growth coming into the New Year.   In the minutes of the November Monetary Policy meeting, RBA board members noted that global economic growth had remained above potential throughout 2018 and Australian GDP growth was expected to be above average over 2018 and 2019. Labour market conditions have been stronger than expected and year-ended inflation had remained low in the September quarter.   Mr Partridge said, “The RBA board does not meet to make a cash rate decision in January however lenders’ interest rates could move in the interim.   “Coming into the New Year, it’s important for those looking to buy their first home or investment property to take stock of their financial situation and set clear, strategic goals. Falling property prices and attractive interest rates on new loans present a good opportunity for those looking to buy their first home.   “I would encourage first time buyers to make an appointment to speak to their local mortgage broker to find out if they’re in a good financial position to secure a home loan. An experienced broker will review a prospective borrower’s financial position and help coach them through the steps to get home buying ready.    “The end of the year is a good time for borrowers to take stock and ensure their existing home loan is still suited to their needs. Borrowers should get a home loan health check to determine whether they could secure a more competitive interest rate or access flexible loan features,” Mr Partridge concluded. RBA Chalks Up Two Years 2018-08-08T04:55:59Z rba-chalks-up-two-years The Reserve Bank of Australia (RBA) has today made the decision to keep the nation’s official cash rate on hold at 1.50%, marking two years at this record low rate. “A number of factors are contributing to the RBA board’s decision to hold the official cash rate for such a sustained period,” Mortgage Choice Franchisee, Scott Partridge said. “The RBA recently raised concerns over the vulnerability of overly indebted households to economic shocks and noted the implications that a significant change to interest rates would have on these households’ disposable incomes. “It will not have escaped the Board’s notice that dwelling values across the nation have shown a consistent decline over the last three months. Indeed, the latest data from CoreLogic suggests the decline in dwelling values may be gaining momentum, driven by long-term falls in Perth and Darwin, as well as the two largest housing markets, Sydney and Melbourne. “CoreLogic’s Hedonic Home Value Index also revealed that national dwelling values fell 0.6% in July. An increase to the official cash rate could put further pressure on the nation’s housing market. “Further, the latest Consumer Price Index for the June quarter came in under market expectations and below the RBA’s target range, rising 0.4% on the previous quarter and 2.1% annually. This lacklustre result is expected for some time to come. Economists suggest a mix of other factors contribute to the board’s decision each month, such as data on consumer and business sentiment and business conditions across industries. “The most recent Quarterly Business Survey from the National Australia Bank found that favourable business conditions continue and point to business investment growth. High commodity prices are resulting in favourable conditions in the mining sector, however business confidence is just above average, where it has been for some time,” said Mr Partridge. “Consumer sentiment has a significant impact on the economy and while the latest Westpac Consumer Sentiment survey reported the most positive reading since November 2013, the overall level of sentiment is below the long-term average as consumers continue to feel pressure from sluggish wages, rising electricity and petrol prices and declining dwelling values. “Another factor which influences the board’s monetary policy decisions is the national unemployment rate, which is sitting at 5.4% according to the latest Labour Force Survey from the Australian Bureau of Statistics. This is regarded as notionally full employment. “Abroad, conditions in the global economy remain generally positive. In the United States, the Fed raised the federal funds rate at its June meeting and is expected to raise it again. “Some are calling for the RBA board to make a change to the stagnant cash rate. My view is that raising or cutting the rate at present could have negative ramifications to the growth of the economy and may place undue pressure on family finances. “Looking ahead, I expect the cash rate to remain static for the foreseeable future. However lending standards are expected to tighten further, which could make it harder for some to secure a home loan. For this reason I would urge anyone seeking a home loan to speak to a qualified mortgage broker who can help guide them through the home buying process. “Despite the complexity in the lending environment, prospective buyers could benefit from softening property prices and the lowest mortgage rate in decades, which makes now a great time to buy,” Mr Partridge concluded. 3 in 10 home buyers turning to mortgage brokers 2018-05-01T00:20:21Z 3-in-10-home-buyers-turning-to-mortgage-brokers Home buyers are increasingly seeking the expertise of professional mortgage brokers, according to new data. Mortgage Choice and CoreData’s new Evolving Great Australian Dream 2018 whitepaper reveals 28.2% of home buyers saw a mortgage broker first when they purchased a home or investment property, up from 16.2% last year. On the other hand, the proportion of consumers seeing their current financial institution first dropped from 60.7% to 44.2%. “For many Australians, the first point of contact in the home buying journey is the lender they currently bank with, but our data shows that the use of mortgage brokers continues to rise,” Mortgage Choice spokesperson Jacqueline Dearle said. “We have seen a 12% jump in the proportion of property buyers seeking the services of a mortgage broker for their home loan needs, which is an encouraging indication that consumers are seeing great value in what brokers have to offer. “In today’s increasingly competitive mortgage market, there are so many changes which makes searching and applying for a home loan a daunting and complex process, even for experienced borrowers. “Mortgage brokers can save borrowers time, hassle and possibly money by finding a suitable solution for their individual financial situation and goals and taking the legwork out of the application process. “Compared to a financial institution that can only offer a particular home loan product, a mortgage broker has access to an extensive panel of lenders so they can compare from a wide choice of mortgages. “In addition, a broker provides reassurance and guidance through the home loan application process, from application to approval through to settlement, and they will take the time to educate customers about the market.” According to the whitepaper, the use of a mortgage broker increased among home buyers across all age ranges, with the highest usage coming from those aged 45 and under. The data showed 43.5% of Australians aged between 25 and 45 saw a mortgage broker first when buying a property, up from 30.1% last year. On a state by state comparison, broker usage was the highest in Western Australia, with 36% of buyers in that state seeing a mortgage broker when buying a property. This was followed by New South Wales at 30%. Ms Dearle said she expected the popularity of mortgage brokers to continue to be robust among Australian home buyers. “Whether someone is just starting out on their property journey, or they have purchased property before, the lending environment is increasingly complex, and on top of that, Australians are increasingly becoming time-poor,” she said. “As our data has shown, consumers know and see value in what brokers have to offer in providing choice, better customer service and expert credit advice. “Consumers also know that at the end of the day, they are getting a competitive home loan product that is tailored to their unique set of circumstances and goals. “With many benefits to be had, I would expect consumer demand for mortgage brokers to remain strong in the coming years.” Mortgage Choice in the Hills specialises in finding the right loan at the right rate. We work hard to make the process is as easy and stress free as possible. And it’s all at no cost to you. Call us today on 02 9653 9333, email: scottpartridge@mortgagechoice.com.au or or click HERE to arrange a time to discuss purchasing your first home. Home loan demand drops in December 2018-03-02T05:10:37Z home-loan-demand-drops-in-december Home loan demand took a tumble in December, according to new data by the Australian Bureau of Statistics. The latest Housing Finance Data from the Australian Bureau of Statistics found 55,161 home loans were approved throughout December 2017, which represented a 2.3% drop from the month prior when 56,876 home loans were approved. “While it is somewhat surprising to see a drop in activity in December, given that it is traditionally a strong month for home loan demand, today’s results are very indicative of the market we are in,” Mortgage Choice chief executive officer John Flavell said. “If we look at years gone by, we tend to see a small bounce in home loan demand in December. This is because many borrowers are keen to buy property and move into their new home over the summer period when they are likely to have time off work. “But this time around, the story was a little different. Of course, when you consider the fact that some of the heat has come out of the property market, the 2.3% drop in home loan demand seems reasonable.” Mr Flavell said recent data from CoreLogic found property price growth had eased considerably across most states and capital cities. “Throughout December, property prices fell 0.4% across the combined capital cities,” he said. “In Sydney, prices fell by 0.9% throughout December, while Melbourne property prices fell by 0.2% over the same time frame. “This drop in property values correlates closely with today’s data from the Australian Bureau of Statistics. “In December, the total value of all home loans approved fell by 1.6% to just under $33 billion. “Just over $21 billion in owner occupied loans were approved throughout December - down 1% on the month prior, while almost $12 billion in investment loans were approved - down 2.6% over the month.” Looking ahead, Mr Flavell said he wouldn’t be surprised to see another drop in home loan demand as well as the total value of all home loans written. “The market has definitely started to show signs of stagnation,” he said. “Of course, that said, it is still important to note that while home loan demand has eased slightly in recent weeks and may continue to ease, overall demand for home loans does remain strong by long term standards.” “I do not expect to see home loan demand fall off a cliff. The reality is, mortgage interest rates are still low and this should help to keep heat in the market.” How important is your credit score? 2018-01-24T10:05:09Z how-important-is-your-credit-score 'Credit profile’, ‘credit score, ‘credit assessment’: if you’re thinking of taking out a home loan, these are important terms you’ll need to learn more about. What is a credit score? All credit active people have a credit profile. This is a summary of your history with every credit provider you’ve ever dealt with, and serves as a record of how well you’ve managed your credit accounts like loan repayments, overdue debts, how often you’ve asked for credit and the kinds of loans or credit you’ve applied for, and the frequency of your credit applications. Credit reporting providers summarise your credit profile into something called a credit score. The score is between 0 and 1200, where the higher the number, the more likely you are to be able to repay a loan.  Lenders look at your credit profile and credit score to find out about your credit history and behavior, and assess if you are able to take on a new loan. This information reassures lenders that you’re good at paying money back to those you’ve borrowed from – i.e. you are a ‘low risk’ client. A good credit score not only makes you more likely to get approval on your home loan application – but it also means you’ll qualify for a better interest rate. Of course, the other side of the coin is that if you have a poor credit score, you will be less likely to qualify for any new loans.  This protects those with low credit scores from taking out additional loans and overextending themselves and getting into more debt. In short, you’ll need to have a good credit score rating for your home loan application to be approved. It’s therefore a good idea to first find out what your credit score is before applying for a loan, and to give yourself time to improve it before approaching a lender. How to check your credit score A great place to start your credit score research is ASICs MoneySmart site.  You can get a free credit score from a number of online providers, which are listed on the MoneySmart site. To avoid any credit surprises, be prepared and know your credit score. I can assist by reviewing your credit history and help you to establish a plan to improve your financial history. If you need any assistance in this matter please don’t hesitate to call us on 02 9653 9333, email: scottpartridge@mortgagechoice.com.au A full year of no change 2017-12-05T10:33:44Z a-full-year-of-no-change The Reserve Bank of Australia has today ended the year just as it began – with no changes to the official cash rate.                                                                 Today’s decision to leave the official cash rate on hold at 1.5% marks the 16th consecutive month that the cash rate has been left at this historically low setting.   The last time we saw this prolonged period of interest rate stability was back in 2013/14 when the cash rate was left on hold for 17 consecutive months.   Speaking about the Board’s cash rate decision, Mortgage Choice franchisee Scott Partridge said he was not surprised to see the Reserve Bank ring out the end of the calendar year with another month of rate stability.   “The latest data would suggest the Australian economy is performing relatively well at the moment and doesn’t need to be helped or hindered by a change to the cash rate,” he said.   “Property price growth has stagnated across Australia, which is line with expectations. According to the latest data from Core Logic, property values across the combined capital cities fell by 0.1% over the month of November.   “At the same time, consumer sentiment took a bit of a tumble, with pessimists once again outweighing optimists. In addition, inflation is currently sitting at 1.8% - slightly below the Reserve Bank’s target band range of 2-3%.   “On a positive note, business conditions hit a new high in October, according to National Australia Bank’s latest monthly business survey.   “Pleasingly, the strength in business conditions was quite broad based and felt across most industries. Even retail rallied throughout October.   “When you look at all of this economic data, it is clear that the Reserve Bank of Australia’s decision to leave the cash rate on hold for an extended period of time is having the desired effect on the economy.”   But while Mr Partridge wasn’t surprised to see the Board leave the cash rate on hold this month, he said it is only a matter of time before the Reserve Bank does look to increase the cash rate.   “I believe a cash rate rise is inevitable, it is now just a question of when it will happen,” he said.   “The Reserve Bank may be willing to leave the cash rate untouched for some months yet. Regardless of what the Reserve Bank does or doesn’t do to the cash rate in 2018, interest rates are currently sitting at record lows and will remain lower for longer.   “As such, for anyone who is looking to buy a property in the New Year, now is a good time to start that process.” Five Tips for Saving Money in December & January! 2017-11-28T00:31:06Z five-tips-for-saving-money-in-december-amp-january Rather than getting caught up in the “spend now, worry later” approach, now is the time to plan for Christmas and holiday spending. It may be the silly season but sensible strategies never go astray. We all know how expenses can add up at this time of year: kids are at home, expecting to be entertained, families often travel to holiday destinations, which means more money spent on petrol, food, and accommodation. And, if it’s your turn to host relatives or friends this year, there’ll be extra mouths to feed, more fun outings to finance, bills to haggle over and more than likely a higher utility bill to cover. Christmas gifts also need to be bought, cupboards traditionally stocked with snacks, drinks and extra holiday ‘spoils’ and, if that’s not expensive enough for you, there’s also the ‘Back to School’ season to prepare for in January, with all the financial commitments this entails. If you’re lucky, their might be a surprise work bonus; if not, you may need to put some plans in place to see out the leaner days in January, when life gets back to normal and all the celebrations are over and done with for another year. The following are a 5 tips for saving money for December and January and surviving the silly season. Don’t use your credit card - pay cashAs far as possible, avoid using your credit cards for paying off holiday expenses. Swiping your credit card to pay for luxuries may be tempting, but if you don’t have the means to pay it back in time or any extra savings to fall back on, it may be wise to tuck that card away safely and only use it for regular budget items instead. Setting a budgetDrawing up a special and realistic budget for the holiday season is a helpful for saving money over the December/January period. Knowing how much you have, are willing to spend, and on what exactly, can help you stay financially disciplined, especially when the stores and the kids are pulling out all the stops to get you to indulge and ‘buy, buy, buy’! Cuts costs and save money nowAs you ramp up for the December holidays, consider cutting back on any unnecessary, nice-to-have spending over the next couple of months: eat out less, save your clothes budget for essentials, keep an eye out for specials, and check out holiday sites for discounts on flights and accommodation. If you haven't already, now is a good time to start stocking up on Christmas shopping – especially for gift purchases and buying non-perishable food items. Let your home work for youHomes no longer have to stand empty over the holiday season: new online platforms like Airbnb make it easy to rent properties out to visiting tourists (or locals) who aren’t willing to pay expensive hotel or B&B rates and are happy to forego some finer luxuries to save on holiday accommodation costs. Use the money you earn from letting your home out over the festive season towards paying for your own holiday or save this money for the leaner months in the New Year. Better still, put your earnings into your home loan! Don’t neglect your home loanThis brings us to our final tip: as tempting as it might be to cut down on your home loan repayments over the upcoming holiday season, don’t. It’s important to protect your most important assets and not cut corners for short-term gains. Remember that the best gift you can give your family is the roof over their heads and their education. Keep the silly season in perspective and don’t put yourself under unnecessary financial pressure which you may regret later. Need help with your finances, talk to us today on 02 9653 9333 or email: scottpartridge@mortgagechoice.com.au 5 Tips to consider when Refinancing your Mortgage? 2017-11-06T03:52:28Z 5-tips-to-consider-when-refinancing-your-mortgage When was the last time you had your home loan checked? If it’s been several years, you could be paying too much. In recent months, lenders have ben adjusting their interest rates in home loan products, with some offering fixed home loan rates as low as 3.69% for a three-year term. Here are 5 tips to consider when refinancing your mortgage. Is it the right move? When conditions are right, financially and economically, you might be considering a refinance of your mortgage. Before you jump into what seems like a good idea, it’s best to know exactly what the refinancing process is, and just what it entails. You should know that when you are going to refinance, it involves starting the loan application process right from the start, as if you are buying a new home. Will you be taking the loan with a new lender, setting up a new deal, or should you shop around and see what's on offer from other loan providers? The best person to lead you through what is now a veritable minefield of lenders, is your mortgage broker. They are far more up to date with what's on offer than if you spent hours scouring the internet looking for the best deals. Why Refinance? What are your reasons for refinancing? There could be a variety of reasons. Lower interest rates on offer? A difference of a point or two in the rate may seem small when you look at it, but that couple of points can save you thousands over the years because your repayments will go on for 15 to 30 years for a typical mortgage. Another reason some may decide to refinance is to get a shorter term, which also saves thousands of dollars. For example, things have never looked rosier personally, and both you and your partner are working, and your income is higher. So, a change in your financial situation can be used to save money on higher monthly payments. Conversely, you might be after a lower monthly payment or have that fixed rate changed to a variable rate, or vice versa. Refinancing Costs There are some obvious things to look at when considering refinancing. One of the first things is the actual cost of refinancing.  Look at the fees you will be paying and divide it by the months of your mortgage and see whether there is a saving as a result of the refinancing. Sometimes you are ahead straight away, other times you might have to work out when you will hit the break-even point. Penalties Are there any penalties in your mortgage terms and conditions that apply if you pay out the mortgage early? Lenders do NOT like mortgages paid out early. Remember, when you refinance, you are paying off one loan and applying for another completely new loan. Add any penalties to your total costs for refinancing and calculate that break-even point again. Be certain that you are not losing money overall when you refinance. Your Equity An important factor in this whole process is to work out the equity you have in your home. A negative equity is when you owe more on the home than what the house is worth. If you have been in your home for a number of years, the annual increase in your home's value will stand you in good stead. But if this is a refinance taken out after only a short time into your mortgage, price fluctuations may have worked against you. If your lender is offering less than the equity, you will not be able to get the refinance, unless, of course, you have the money to pay the difference. Current markets indicate an overall rise in prices, but there have been some downward movements as well over the year and that may have had a negative effect on your home's value. See your Mortgage Advisor With so many variables to look at with a refinance, you can get some quick answers by putting it into the lap of your Mortgage Choice advisor who probably got you the initial loan. With up to date calculators and current interest rates available from many lenders, you can get a fast answer to any refinance query. Talk to us about your refinancing needs today.  Contact us on 02 9653 9333, email: scottpartridge@mortgagechoice.com.au or click HERE to arrange a meeting. 7 Common Loan Application Mistakes and How to Avoid Them 2017-10-04T05:17:43Z 7-common-loan-application-mistakes-and-how-to-avoid-them Planning to apply for a loan?  Or have you unsuccessfully applied for one, and are wondering why your application was rejected? Getting an application for finance approved can be daunting for first-timers and the experienced alike – the process is littered with large quantities of paperwork and requires plenty of legwork and patience.  We look at 7 common loan application mistakes and how you can avoid them when you apply for a loan. 1.Your credit file is littered with too many credit enquiries and notations. As a borrower, you want the best deal. Problems may occur when you have too many marks on your credit file. Regardless of the lender, because they all have access to the same credit files, there will be alarm bells. Tip: Don’t give approval to other lenders to access your credit file until you have decided on the preferred lender. Work with your Mortgage Broker to find the best home loan, taking into consideration your needs and circumstances, and then submit your application. 2. Yоur hоmе loan application is badly written. An innocent error or an omission on your loan application when answering questions about your credit history can be seen as suspicious, possibly even fraudulent, by the lender. Tip: Have your Mortgage Broker ask for the credit report for all parties to the loan before any application is submitted. Your broker can write a covering letter with explanations if required. Don’t underestimate the value of your Mortgage Broker in getting your application approved. Some brokers carry a lot of trust with lenders. 3. The Lender states you don’t have enough savings, too small a deposit or too low an income. Deposit amounts and income requirements can vary from lender to lender. You also need more than the deposit when buying a home. There are conveyancing costs, mortgage insurance, stamp duty and possibly other legal costs or taxes. Tip: Make sure you are confident that you have the required funds. Your Mortgage Broker can help you by giving you accurate costs that will be incurred with a home purchase. If required, your broker can help find a lender that requires a smaller deposit, or one that pays your mortgage insurance, or a lender that requires no mortgage insurance. 4. The appraisal for the home you want to buy comes in less than the agreed purchase price. This can be a major disappointment. Banks lend on Loan to Value Ratios (LVR’s). For example, if a property is valued at $360,000 but the asking price is $400,000. You have your 10% deposit, ($40,000) and you have money for the costs, about $8,000. The lender will only provide 90% of the $360,000. This scenario is going to leave you $30,000 short. Tip:  If a home appraises for less than its purchase price, there are a few potential outcomes: Buyer and seller renegotiate a new, lower home sale price Buyer increases down payment to meet new LTV and down payment minimums Request an appraisal rebuttal (a service for which you will have to pay) Buyer chooses neither option, and cancels home purchase contract 5. Your employment status has changed recently.   Mortgage lenders don’t seem to be too keen on people changing jobs if the unemployment ratio is a bit high. They think, ‘unstable’ and you might default on the loan. Most companies also have probation periods of 3 and 6 months and income assessment can’t be done until after probation is over. Tip: There are lenders who look at employment and the ability to repay in different ways. Your Mortgage Broker can find these lenders. Failing that, your broker will look at other ways to have your loan approved. 6. Your savings history is bad or very irregular. Lenders love seeing stable income and regular savings, at least 6 months of it. A saved deposit or at least proof that you will be able to meet monthly repayments will go a long way towards approval. A lump sum appearance in your account, or if you are self-employed with seasonal bank movements are not as favourable with lenders. Tip: Yоur Mortgage Brоkеr wіll source your loan frоm lеndеrѕ thаt allow unѕаvеd dероѕіtѕ, gift dероѕіtѕ аnd parents hеlр. 7. Your idea of a dream home is not shared by the lender. Apart from the low appraisals spoken about earlier, some lenders have policies about certain properties such as an unacceptable postcode, or the property is considered to be rural. Tір: Residential mortgage lоаnѕ саnnоt be used for wоrkіng farms fоr instance. The ѕmаllеr acreages wоuld not be viable аѕ a working fаrm, and thеrеfоrе mау bе соnѕіdеrеd аѕ "rеѕіdеntіаl rural". There are also some types of apartments that the lender might find unacceptable. Your Mortgage Broker can help you find specialist ‘niche’ lenders that are happy to lend against these types of properties. Our Wrap Using a Mortgage Broker is a free service to the borrower. So, using our services makes sense simply because we work to find a solution to your situation as well as being able to do the legwork involved in securing a loan. We can save you making any of the 7 common loan application mistakes listed above. Why go through all the hassles yourself when the whole deal can be done for you professionally, ethically and reasonably quickly? Talk to us about your home loan needs today.  Contact us on 02 9653 9333, email: scottpartridge@mortgagechoice.com.au or click HERE to arrange to arrange an obligation-free appointment.