September 3, 2010

Aussie’s Top 10 Franchises Announced

Aussie’s Top 10 franchises have been announced, with Aussie Parramatta has been awarded the title of the best performing Aussie franchise in Australia settling more than $160 million worth of home loans during the last financial year. The result confirms the wonderful job the Parramatta team, led by Ross Le Quesne, Scott Le Quesne and

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Aussie’s Top 10 Franchises Announced

Mining tax creates WA housing uncertainty

THE mining tax has had an unexpected impact on the property market in WA with the number of home loans committed to falling in May.

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Mining tax creates WA housing uncertainty

Home loans on the rise after eight months

THE number of home loans for owner occupied housing rose for the first time in eight months in May, official figures show.

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Home loans on the rise after eight months

Fixed rates become more competitive

Several lenders are offering big cuts on fixed rate home loans, according to Loan Market.

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Fixed rates become more competitive

Real Estate Report – 24/05/10 – Finance News Network (press release) (subscription)

Real Estate Report – 24/05/10 Finance News Network (press release) (subscription) The number of home loans taken out for investment rose in March, adding weight to the view that rising property prices are partly being driven higher by …

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Real Estate Report – 24/05/10 – Finance News Network (press release) (subscription)

How to choose an investment property loan

I’ve often been asked whether taking out a loan for an investment property is the same as taking out a loan for a house to live in. The answer is no, it is not.

Buying an investment property is about identifying a residential property asset that provides you with the right mix of rental return, capital growth and profit. If you choose the wrong property your investment strategy could go up in smoke. The same applies to choosing the right investment property loan. You want a loan that helps, not hinders your investment objectives.

This means that a loan that might be suitable for your home and lifestyle needs may be totally unsuitable for your investment property needs.

You need to ask yourself a number of key questions which include:

  • How long do you want to hold on to the property before selling it? For example, if you intend to hold it for three years, it’s no good taking a five year fixed rate mortgage. You’ll be up for some hefty early settlement penalties which will eat into any capital profits you may make
  • How much of your own funds will you contribute to the purchase price? There may be limitations on the amount your lender is willing to lend against meaning you’ll either contribute more of your own funds or look for other forms of security – like your existing home.
  • What loan type do you need to maximise your tax strategy? For example, would you be better off with an interest only or amortising loan?
  • Do you want to be positively or negatively geared? You may need to sacrifice flexibility for a low interest rate/low cost loan product.
  • Do you want to pay the loan down quickly? In which case you should look at loans that allow lump sum and extra payments without penalty.
  • What will your investment/ownership structure be? Will you own the property in your name or through a company or trust? You’ll need to make sure your lender is prepared to lend via these types of vehicles and whether they may require director or other types of guarantee.

So there’s a lot to think about before taking out an investment property loan.

My tip

The key is to make sure the loan supports your investment structure, goals and objectives. Be clear about what you are trying to achieve and when you want to achieve it.

Pete Boehm is co-founder of Our Home Sweet Home – a home buyer and property investor resource where you’ll find home loans, mortgage calculators, guides and more. If you’re looking to buy your first home sign up to Our Home Sweet Home’s free seven week e-mail course 7 Steps to Home Ownership. Follow Pete on Twitter or join the conversation at the Our Home Sweet Home Blog. You can also ask Pete a question.

Real Estate Report – 17/05/10 – Finance News Network (press release)

Real Estate Report – 17/05/10 Finance News Network (press release) The number of home loans taken out for investment rose in March, adding weight to the view that rising property prices are partly being driven higher by …

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Real Estate Report – 17/05/10 – Finance News Network (press release)

How to resolve bank disputes

Disputes between banks and their customers are on the up – leaping an incredible 33 per cent in the first half of 2009, according to the Financial Ombudsman Service.The huge growth in complaints (from 14,359 to 19,107) is partly a result of the global financial crisis and increased anxiety amongst consumers, says the Ombudsman, who expects the trend to continue.

What are we disputing?

More and more, it’s our credit products (6,731 disputes, up 36 per cent), our insurance policies (6,406 up 34 per cent), our investments (1,540 up 68 per cent) and our payment systems (1,474 up 8 per cent).

We’re complaining about banking errors (both by computers and humans), contract and calculation errors, insufficient or misleading disclosure statements, and conduct that contravene legal codes. Interestingly, the Ombudsman also highlighted a large increase in disputes with lenders about the costs of breaking fixed rate loans.

In my Yahoo7 column Going direct to a home lender I examined how service levels at the big banks can vary considerably, and with the popularity of complaints forums such as Not Good Enough, some of us might say it’s no surprise that disputes are up.

So, if you find yourself in a dispute with your bank or financial provider, what can you do to have it resolved in your favour?

How to fight the bank

Here are some tips to follow:

1. Be clear about what you’re disputing

When you’re in a dispute with your bank, it’s important to be clear and concise. Be specific by listing the questions you want answered and what actions you’d like to the bank to take.

Be sure to keep records of any conversations you have, as well as copies of all documentation. Keep the details of the people you speak to and, if you can, carry out your discussions in writing – that way you’ll avoid misunderstandings about what has been said or requested.

Most importantly, stay calm now matter how angry or upset you might become. High emotions don’t do anybody any good. Focus on the facts while looking for a mutually acceptable solution to the problem.

2. Follow the bank’s dispute procedures

Each of Australia’s major banks and most of our financial institutions are members of the Financial Ombudsman Service. This membership requires them to have internal dispute resolution procedures and you should familiarise yourself with these before you start (information is usually to be found online or in your local branch).

While the big banks have large departments which deal exclusively with complaints, the best initial point of contact for your dispute is usually your branch. Start there, and try to ensure that the branch undertakes any proposed actions within the agreed upon time frame. Be sure to keep a record either way.

3. If you’re still unhappy, escalate

If you’re dissatisfied with the response you receive at branch level, ask how you can escalate the matter. Usually, this will result in the dispute being sent to head office or the internal dispute department.

Rather than dealing with a call centre, ask for a specific case worker to be assigned – a consistent point of contact that understands you and your problem and can take ownership of the issue.

At the same time, be prepared to compromise. You might not always be able to get exactly what you want, but if you can get most of it, that’s often the best outcome.

4. Stick to your obligations

When you’re in a dispute, it can be tempting to send a message by stopping payments or failing to meet your obligations while your dispute is unresolved. This is always a bad idea.

Failing to fulfil your obligations won’t help your cause, and might result in further financial penalties. Always stick to your obligations unless you have an agreement, in writing, that they will be suspended while the dispute is ongoing.

5. Seek outside help

If all else fails, ask your bank how you can take things further and refer the matter to the Financial Ombudsman Service.

The Ombudsman will investigate banking, insurance and investment disputes and is a free service. If the Ombudsman can’t help, they will likely give you a further pointer to someone who can.

Staying calm:

Remember, your aim should always be to get your dispute resolved as quickly and as amicably as possible. At all times, state clearly what you want, keep your cool, retain good records, and follow the bank’s resolution procedures.

If that fails, escalate your problem and go to the Ombudsman, but always be prepared to compromise if it means receiving most of what you want.

Pete Boehm is co-founder of Our Home Sweet Home – a home buyer and property investor resource where you’ll find home loans, mortgage calculators, guides and more. If you’re looking to buy your first home sign up to Our Home Sweet Home’s free seven week e-mail course 7 Steps to Home Ownership. Follow Pete on Twitter or join the conversation at the Our Home Sweet Home Blog. You can also ask Pete a question.

Loans slump may point to house price fall

The number of home loans dropped 1.8 per cent in February to 50,287, after January’s slide was revised upward to a 7.3 per cent drop.

Mr Robinson cautioned that the rule held over the past two and a half years but the last six months could be different because there is considerable buoyancy in the housing market, along with strong confidence.

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Demand for home loans slumps in January

DEMAND for new home loans dropped nearly 8pc in January, the fourth consecutive monthly decline.

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Demand for home loans slumps in January