Hopefully the Reserve bank feels this is sufficient and at the next meeting decides to keep the rates on hold but we won’t hold our breaths.

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We have some of the best fixed rates available and some new specials starting this week so if you think you are not getting the best deal from your current lender, please feel free to contact us for an obligation free quote.

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The RBA raised the cash rate by 25 basis points to 4.0 per cent after Tuesday’s monthly board meeting, a move expected by a majority of economists. So far the lenders have reacted by following the 25 basis points increase on their books as well.

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Check out this new 3 year fixed rate special from one of our lenders, really good rate and one of the most flexible fixed rates in the market today as it allows for unlimited lump sum repayments as well as 100% offset accounts. A cheaper and more flexible fixed rate than this will be pretty hard to find. Click here for more information.

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The Reserve Bank of Australia (RBA) left the official interest rate unchanged at 3.75 per cent on Tuesday. This is good news for our borrowers as people need a breather from their Christmas expenses and many borrowers are struggling with their mortgage repayments at the moment.
As a broker we can still find borrowing solutions for people finding it hard to cope or are struggling with repayments so please do not hesitate to contact us and discuss your situation, our advice is free.
A home loan health check once or twice a year is always a good idea. Cheers to a prosperous 2010.

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This has come as quite a surprise to the broker channel as Rams has been well supported since re-establishing themselves in this sector.

At the same time Westpac have announced a reduction in their LVR (loan to value ratio) to 85% for new customers. Existing clients can still access the 95% lend. By doing this it looks like they are trying to limit their mortgage lending exposure and try and sort out some funding issues.

Fortunately as a brokerage we have access to many different lenders and what the one lender does not offer we can access from another lender. Hopefully we will also see a lot more new  and exciting products come through the non bank lender channel especially in the lo doc sector so watch this space!

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We do however still have access to a large number of lenders who still do the traditional lo doc loan up to an 80% LVR for purchases and re-finances.

If you’re interested in setting up a lo doc loan, or any of our other products, please contact us via phone or our online form.

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The poll by mortgage broker, Loan Market Group, found that 44 per cent of homeowners increased their home loan while interest rates were at their lowest in nearly 50 years.

One in 10 added to their credit card debt, slightly fewer took on a personal loan, and the same number made a purchase on interest-free terms, while seven per cent borrowed from their relatives.

Just 23 per cent were prudent in not taking on any more credit.

The increased debt burdens were of concern now the Reserve Bank of Australia (RBA) was raising the cash rate, Loan Market Group chief operating officer Dean Rushton said.

“Many Australians have borrowed more while the RBA reduced interest rates to near record lows of 3.0 per cent in response to the global financial crisis,” he said releasing the survey on Wednesday.”

“Hundreds of thousands of Australians are in greater debt than they were a year ago so any increase in interest rates will hurt.”

The central bank raised the cash rate for a second month in a row on Tuesday, lifting the cash to 3.5 per cent.

Economists are divided over whether the RBA will raise rates again in December, but they anticipate further moves in 2010 towards a cash rate of five per cent.

Still, the survey of 600 respondents found people without a mortgage were more careful with their budgets, with 39 per cent saying they took on no new debt when rates were in the trough.

However, 22 per cent borrowed from relatives, 16 per cent added to their credit card debt, 13 per cent took on a personal loan and 10 per cent made an interest-free purchase.

Quoted from Lending Central website

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Genuine savings requirement means that a lender wants to see that the borrower has the ability to save funds over a period of time. It is sort of like the lender wants to see the character of a borrower and wants to see if the borrower ahs the ability to save some funds and get into the habit of putting money aside to repay their mortgage.

Gone are the days of the 100% loans and 105% lenders

The maximum some lenders will borrow is 95% plus capitalize the lender mortgage insurance on top of that.

Genuine savings must be evidenced over 3 months in the following way:

1. Money held in a bank account over 3 months.
   There must be evidence of periodic savings deposited into the account. Most lenders will not accept a lump sum deposit and nothing else over the next few months.
2. Gift – this must have been held in an account for a minimum period of 3 months
3. Term Deposit – this must have been held for a minimum period of 3 months
4. Cash -acceptable only if placed in account for a minimum period of 3 months
5. Shares – these must have been held for a minimum period of 3 months
6. Equity in an existing property

Some lenders are less stringent than others and only require 3% genuine savings.

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A lot of borrowers do not plan ahead and do not allow for the increase in repayments hoping that the rates will not go up. There are many factors that decide on rate increases and some of them can be outside the economists and financial guru’s predictions (just look at what happened last year with the global financial crisis)

Always try and plan ahead and do not lend more than you are comfortable at repaying your mortgage on a buffer of 0.5% or even 1% higher than your current interest rate.

Life is unpredictable and job loss, sickness and the economy can sometimes be totally out of your control.

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Being a variable interest rate loan the interest rate can fluctuate depending on what is happening in the financial markets which can benefit you if the interest rates go down. Some of the features are listed below:

• Redraw – This allows you to access surplus funds that have been paid into the loan in excess of your normal monthly repayments.
• Offset – Funds held in an offset account can help reduce the interest cost on your loan.
• Additional Payments – Principal reductions can be made at any time without incurring a penalty.
• Portability – Even if you sell your existing property and purchase a new one you can keep the same loan and the benefits you already enjoy with this type of loan.

For more information, please contact us by phone or use our online contact form.

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• To take that well deserved holiday
• To purchase a new motor vehicle or lifestyle asset
• To help a family member
• To fund renovations to your home

For more information, please contact us by phone or use our online contact form.

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These loans are similar to asset loans but are offered as short term solutions to borrowers needing fast access to cash. These loans do require a genuine exit strategy i.e. borrower will need to have a plan in place to repay the loan; this is generally a mainstream lender who will take the private funder out or the sale of the property.

Different situations and securities will govern the rates and terms so please phone for a quote, or send us your details using our online contact form and we will call you back as soon as possible (generally within 24-48 hours).

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