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Sandra & Peter Erdel - Lift Lending Peakhurst

5 days ago

Competition among lenders for home loans remains steep but borrowers may still be missing out on great deals and important information that could save them thousands of dollars.1. YOU CAN SET UP A LINE OF CREDIT TO HELP FUND YOUR INVESTMENT PROPERTYIf you are negative gearing an investment property, you will have a shortfall between your costs and rental earnings. You can fund this gap with a line of credit (LOC) product using equity in your home or another property.Say you have a gap of about $500 each month for your investment property, including interest and other costs, such as repairs and rates. You could set up a LOC for $20,000 to fund these expenses for a period of time, which may give you a little more financial breathing room. How long the LOC holds up will depend on interest rate fluctuations and your rental costs.Like interest on your primary investment loan, the interest on this LOC is tax deductible, providing its sole use is to cover your investment expenses.One caveat: this strategy works providing there is capital growth in your investment property over the same period, otherwise you are eating into your capital gain.You also need to have some fiscal discipline and not dip into the LOC for non-investment related expenses, such as holidays.While lenders will be able to set this structure up quite easily, they are not likely to offer it up front as part of your investment loan. Talk to your broker and financial advisor about whether this strategy is a smart option for you.2. PEOPLE WITH POOR CREDIT RATINGS CAN STILL GET HOME LOANSWhile it's true a poor financial record will probably make it harder for you to land a loan, the doors may not be closed. Lending criteria has tightened in the wake of the global financial crisis but there are still plenty of loans up for grabs for those with a blemished track record or little financial backing.Be prepared, however, to pay a higher interest rate than the standard offering. A Mortgage Broker will be able to help you find loans with less stringent criteria, often labelled non-conforming loans, and will help negotiate with the lender on your behalf. You should also do a budget to ensure you are able to make any repayments, lest you end up adding to your woes.3. THERE ARE WAYS TO AVOID LENDER'S MORTGAGE INSURANCE IF YOU DON'T HAVE A 20 PER CENT DEPOSITLender's Mortgage Insurance (LMI) is a one-off payment by the borrower when a loan exceeds 80 per cent of the property's value. It covers the lender's risk if the borrower defaults, but does not cover any loss by the borrower.LMI can be a painful hit to the hip pocket, often running to several thousands of dollars, especially after a home buyer has scraped together the minimum deposit.One alternative to paying LMI if you have less than a 20 per cent deposit is to secure a guarantor to cover the extra stretch.A guarantor is usually a family member who is willing to put forward their property as security. One of the common myths that can scare family off is that the guarantor is then responsible for the entire loan. Not true. They only need to guarantee any amount beyond the 80 per cent loan-to-value ratio (LVR). Although it's a good idea for a guarantor to seek both financial and legal advice before committing.The advantage of securing additional funding through a guarantor is that it simply gets tacked onto your loan so you can repay it over time, rather than forking out up front for LMI.The key before you make any big decisions about home finance is to have all the facts at your fingertips. Your broker will be able to compare the products and options that are out there and size up which arrangement will work for you and your circumstances.4. YOU HAVE FREEDOM OF CHOICEMost lenders will pitch one or two loan products to customers. But that's a tiny fraction of the number of loans available in Australia. If you want to get a grasp of the wide variety of products out there, consider a mortgage broker.A mortgage broker works for you, not the lender, and can help you tap this vast vein and find the loan that is best suited to your needs.Talk to your broker about your financial circumstances and goals so they have as much information as possible to determine the best product solution for you. ... See MoreSee Less

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Sandra & Peter Erdel - Lift Lending Peakhurst

1 week ago

If you are applying for your first home loan - here is the pain free alternative:The first time you apply for a loan, you could feel a bit like a deer in the headlights. With so many questions to answer, you might start to wonder if your mortgage broker is hatching a secret plot to kidnap you and steal your identity. Understanding what lenders are looking for can help to make the process easier for you, and improve your chances of being approved for a loan.There are five 'C's when it comes to lending...Credit HistoryYour credit record can have a big impact on whether you're approved for a loan. Your lender will want to know about money that you have borrowed in the past, and how quickly you paid it back. Credit cards, phone bills, car loans and many other sources of credit are examined when determining your credit rating.CapitalYour lender will want to know that you have assets and funds accumulated. Particularly, they will want to know how much you will be contributing to the purchase.CollateralYou will need to offer property as security against your loan. Usually this just means that you offer the house as security, so that if you don't repay the loan, your lender can sell the property to get their money back.CapacityYour lender will assess your ability or capacity to meet repayments. This is done by examining your income and financial commitments such as living expenses, other loan repayments and dependants to determine if you are capable of servicing the loan.CharacterThe lender will also take into consideration other details about you, such as your working history and length of employment, how long you have lived in your current residence, and any other available information that might help to determine your suitability for a loan. ... See MoreSee Less

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Sandra & Peter Erdel - Lift Lending Peakhurst

2 weeks ago

How do you get your hands on the equipment you need to grow?And how do you do this whilst still keeping the all-important cash flow and working capital in hand? Talk to me today about smart solutions when it comes to asset and equipment finance. ... See MoreSee Less

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Sandra & Peter Erdel - Lift Lending Peakhurst

2 weeks ago

Do you have the right things covered?It's funny how most of us insure the simple and basic things that can easily be replaced - like our car and the contents of our home.However, not many of us cover the most important things- like our health and income.These statistics outline how 75% of us will be diagnosed with a serious illness during our working life, yet nearly all of us are under insured when it comes to protecting our life and income.Regardless of whether you rent, have a home and mortgage or are paying off an investment property, its important to protect your income in the event of unforeseen circumstances.Please read my short factsheet - Do you have the right things covered? www.mortgageaustralia.com.au/email/files/doyouhavetherightthingscovered.pdf ... See MoreSee Less

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Sandra & Peter Erdel - Lift Lending Peakhurst

3 weeks ago

How to negotiate on price and knock out the competition:All's fair in love and war, and the same might be said for negotiating with real estate agents. Whilst you want to get the best possible deal on your purchase, the agent is responsible for getting the best possible price for their client - the vendor.Depending on how long you have been looking, you might be tempted to just pay the asking price to free up your Saturday mornings again. But just think - how much sooner could you pay your loan off if you saved tens of thousands on the purchase price?If you want to get the best deal on your property purchase, try these 6 tips:Focus on positives all around.The best way to negotiate is for every party to feel like they won the game in some way.Communicate clearly and develop a rapport with the selling agent. Don't try to pick holes in the property.Do your homework. If you want to be able to negotiate on price, you need to have a good idea of what similar properties in the area have sold for in the past couple of months. You should walk through plenty of open houses and keep a close eye on the sold results for your area. (If the selling agent offers to give you a list of sold results, accept politely but do your own research because they will probably choose the highest prices to help in their negotiation with you).Don't try to buy outside of your price range. If a property is advertised at $500k to $550k, and your budget is $450k, don't waste your time.You will only destroy your credibility if the right property comes up with that selling agent in the future.Try to find out what the vendor's motivation is for selling. If they need a quick sale, or if they require a certain settlement period, this could help you to negotiate a deal that works for everyone.By including something in your offer that sweetens the deal, this could put you ahead of other buyers in the race.Timing is everything. Some would advise that it's best to make the selling agent chase you as much as possible. But depending on the area, you might have a win by putting your offer in early. In areas with slow property sales, a vendor might be shocked to receive an offer in the first few days on the market.If you make your offer valid for only a day or two, the vendor will need to decide whether they wait and hope that someone else will come along, or whether they accept your offer for a quick sale. ... See MoreSee Less

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Sandra & Peter Erdel - Lift Lending Peakhurst

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