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banking

Nov 02
0

Banks are destroying your land titles

By | banking, best investment, Financial, Investment, Mortgage, News, Research | No Comments

Banks are destroying your land titles   

Last week we had a couple of days hold up with a refinance matter with one of our clients; the reason was that the banks are destroying your land titles and there may be some hicups in going digital!

It is reported today in the business section of the Sydney Morning Herald –

read more here https://goo.gl/FzUOk2

(Please contact us at info@limepropertysolutions.com.au for further information or the chance to discuss this and other issues in the comfort of your own home)

title-deeds

The old Title deeds will disappear as banks are destroying our land titles

All of the old paper certificates of title have been converted to electronic as part of a national push for conveyancing to go on a new PEXA system. It was not a big surprise to learn that PEXA is owned by state governments, the ANZ, CBA, NAB, Westpac, Macquarie Bank and private equity.

What was a surprise to me is the fact that all my title deeds, being held by a couple of the big banks have probably now been destroyed and no one bothered to inform me that this was being done to my title deeds. I can, we are assured, request a paper print out now from the electronic records.

What is not a surprise is that, moving forward, all future sales of properties whose titles are held by the bank will need to be transacted, at least in part, electronically and of course, the fees for the service will increase.

We have been dependant on the old Torrens title system since around the middle of the 19th century and some property lawyers are questioning this move by the big Banks as they fear it may compromise the security of the system.

While it is not yet fully implemented in NSW, it is now ‘working’ in Victoria where The Law Institute of Victoria has been an outspoken critic of the electronic system. They are arguing it is increasing costs for transactions and undermines those holding titles for security against other assets, as well as adding complexity and legal uncertainty to a what was once a simple, safe system.

One thing is for sure, you will be hearing a lot more about PEXA which is likely to become another new acronym with which we will all be familiar in the future.

The chief executive of PEXA said paper titles were cumbersome to use. “People keep losing them, including banks,” so maybe in the long term it will prove more efficient as well as more expensive!

If you want to know more about this or discuss buying new property investment contact: info@limepropertysolutions.com.au.

Aug 01
1

What a fantastic time it is to buy an investment property!

By | banking, best investment, Economy, finance, Investment | No Comments

What a fantastic time it is to buy an investment property!

Tomorrow is the first Tuesday of the new month of August and we must all appreciate what a fantastic time it is to buy an investment property. So why should it be such a fantastic time to buy an investment property? Well, it looks like interest rates will drop again buy even if they don’t drop this time, many of the major lenders have already dropped their fixed rates in preparation for an expected cut this month with probably another before Christmas.

High Yields and very low mortgage costs result in positively geared investment property

High Yields and very low mortgage costs result in positively geared investment property.

Many banks slashed interest rates for the most popular type of fixed-rate home loan in July, as markets bet the Reserve Bank will act to stimulate the economy this Tuesday. New figures from the comparison website RateCity show as many as 18 lenders cut three-year fixed rates in July, across 112 loan products. Fixed mortgage rates are influenced by financial market expectations for official interest rates, and there is a widespread view the RBA will soon take the cash rate to a new record low.

The average reduction in three-year fixed rates during July was 0.19 percentage points, with lenders including National Australia Bank, ANZ Bank, ING Direct, HSBC and Suncorp among those to have cut. The cuts were occurring in anticipation of the RBA dropping the cash rate from 1.75 per cent to a new record low of 1.5 per cent.

The ANZ Bank slashed 0.44 percentage points off its three-year rate for owner-occupiers to 3.85 per cent; NAB cut its three-year rate to 3.89 per cent while the lowest rate on offer was 3.67 per cent from Mortgage House.

 

With fixed rates of under 4% on offer and property yields of over 5% still possible in the right market place, it is almost certain that most property investors would be looking at positively geared property after tax, meaning that most potential investors can now buy a new investment property which would be costing their normal weekly cash flow absolutely nothing!

 

It is a fantastic time it is to be buying an investment property, give Lime a call to find out more!                      Read more: http://goo.gl/g6f9oa

Jul 26
1

By | banking, best investment, finance, Home Loans, Mortgage, News | No Comments

The best investment loan is not the cheapest

As interest rates continue to fall and the prediction being they may fall even further next month, many borrowers and investors are considering changing lenders to take advantage of even cheaper rates; the issue that must be considered, particularly for active property investors is that the best investment loan is not the cheapest!

The lowest investment loan is not usually the best for your investment property

The lowest investment loan is not usually the best for your investment property

There are now over 1000 different home loan/investment loan products in the Australian property market and trying to work through them is even trickier than trying to find the best mobile phone plan to suit you.

The three areas we believe a property investor should be concentrating on are:-

  1. Flexibility – a loan that will allow you ‘movement’. If you decide to move house, or borrow some money for renovations or another investment property, or need to reduce your repayments while the kids are at high school a no-frill loan generally won’t have the redraw facility and you need. In particular you will need sub-accounts, some which will be fully tax deductible, and some that will have no tax deductibility.
  1. Interest rate – we are not suggesting that this is not important, it obviously is. However, a good broker nearly always negotiates a very favourable discount from the advertised rates so working through the advertised rates only can be unhelpful.
  1. Off-set accounts – These can be a great feature. Funds deposited in a standard interest bearing account you will probably earn less than 1.5 per cent a year and interest is normally taxable!  However, when you deposit money in an offset account the interest credited should be the same as that charged on the investment or  housing loan.

Your Lime property investment consultant will explain how an investment loan would potentially impact your financial circumstances. Working with a highly experienced property investment Mortgage broker can help you to explore the implications and perhaps structure your loans in a way that your home mortgage may end up being paid off much faster than you ever thought possible. This type of structure is not possible on a very low interest ‘no frills’ loan so The best investment loan is not the cheapest!    Read more : http://goo.gl/f08Ha1

Jul 06
0

Are you ready for your next property investment?

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Are you ready for your next property investment?

It’s a new financial year, you really need some tax relief, you want to start accumulating wealth for your future and you have decided to buy another investment property, but are you ready for your next property investment?

The first thing you should probably do is test out your borrowing capacity and ensure you have the funds to go ahead to make sure you are ready for your next property investment.

It's a good idea to check your credit rating before applying for your next property investment loan

It’s a good idea to check your credit rating before applying for your next property investment loan

It is surprising that only 29% of Australians have ever checked their credit rating and yet it is possible to do this free of charge once every year.

It is also surprising, as we have seen with a couple of clients in the last year, that your credit rating may be a lot worse than you imagined, simply because you have been managing your finances too well! Your credit rating can be affected simply by considering a change to loans, looking for new loans and switching loan providers. It would seem that the credit rating system views people who are often changing loan providers or credit cards as ‘high risk’ as they may be constantly changing because they are under financial presure to pay their bills. Very often people are changing just to manage their financial position better and have had no problems or late payments at all and yet their credit score is being lowered.

It is also surprising for some to find out that a small problem they had a few years ago and which has been forgotten about after it was cleared up, still have this period reflected in their credit rating.

Sylvia Pennington of the SMH gives us five tips to ensure we use this new financial year to clear up any problems we may have with credit rating agencies. It’s always possible that something may be on your credit record that should not be there and you can appeal. So follow the tips below and ensure that you are ready to buy that next investment property.

Tips for a glowing report

Credit reporting agencies, including Veda, Dun and Bradstreet and Experian, offer consumers a free copy of their credit report every year. Here are some tips to keep yours healthy.

  1. Check your record for defaults and pay any outstanding debts.
  2. If personal data or debts are incorrectly listed, contact the credit agency and the creditor to have them amended or removed.
  3. Establish direct debits to ensure your bills and loan repayments are on time.
  4. Don’t make unnecessary applications for credit – too many inquiries in a short period can indicate you’re in financial distress and send your credit score south.
  5. Prevent debts becoming defaults by alerting creditors early if you’re having trouble making payments.

Read more: http://goo.gl/hzrgj2

Jun 21
0

Investment property –how much can I borrow

By | banking, best investment, Economy, Financial, Investment, Negative Gearing, News | No Comments

 Investment property –how much can I borrow?

Investment property –how much can I borrow? The answer to the question, “ Investment property –how much can I borrow“, seems to change month by month and sometimes week by week but currently, in a nutshell, the answer is an awful lot!

The critical changes in the mortgage market over 2015 with the introduction of tougher bank lending rules for property investors now seem to be being reversed. Most of the big banks decided they would not lend for property investment at all if mortgage insurance was necessary, so in most cases, the property investor had to be in a position to borrow only 80% of the value of the new investment property. At the same time, the amount they were prepared to lend as a ratio of income was also decreased quite substantially making it much more difficult for buyers to fund an investment property.

Investment property borrowing capacity seems to vary weekly

Investment property –how much can I borrow. Investment property borrowing capacity seems to vary weekly

Now, we are told, some lenders will write loans that were 9.4 times a property investor’s income and we are also seeing banks like Westpac now prepared to lend up to 90% of the value for property investment. In a few cases, some lenders have not dropped their Loan to Value ratio for property investment below their ‘normal’ 95% LVR.

So for a new Investment property –how much can I borrow today? Australian banks have always allowed property investors to borrow a significantly larger multiple of their income than owner-occupiers, despite a crackdown on lending to landlords. This has just been confirmed by some new research by Macquarie. This outcome should not come as a surprise to anyone although the tone of today’s media article suggesting that more tightening in mortgage lending is likely suggests otherwise.

Why would any sane lender offer more to an owner/occupier than a property investor? The lender is obviously going to include some, if not all of the property investment income in assessing a loan as well as, in most cases, some of the tax advantages the property investor will be entitled to through negative gearing. This obviously means that the property investor can afford to borrow substantially more on than an owner/occupier who will have to find the funds to pay the entire due mortgage with their after-tax income!

The research also points out that  banks were offering deeper discounts of up to 1.4 percentage points off their standard variable mortgage rates, a trend that is likely to squeeze bank profit margins; something that will probably not give many of us sleepless nights!

Read more: http://goo.gl/13F2Gk

May 24
0

Lose your credit rating without even knowing

By | banking, finance, Financial, Home Loans, Mortgage, News, Research | No Comments

Lose your credit rating without even knowing

How can you lose your credit rating without even knowing that you had done anything wrong?

Cartoon by Michael Mucci Banks seem to have us where they want us

Cartoon by Michael Mucci
Banks seem to have us where they want us

Just a couple of weeks ago we had a new client with a very stable well-paid government job, excellent equity in an investment property, owing nothing substantial to anyone apart from his very manageable investment loan and looking to buy another property but to our astonishment was actually rejected by the first lender approached on his behalf. Another lender was approached and the client had no problem in getting the loan after “the problem” was fully explained.

….. So what was ‘the problem?’ Quite simply, he had approached a couple of lenders by himself over the last year to see how much he could possibly borrow. In his search, he had found very good lower rate deal and switched his loan – no problem. While he was doing this, he took advantage of a couple of really good interest free deals on a couple of credit cards, something that is encouraged by our government and some financial planners, “If you’re not happy with your lender, shop around and move” and why not take advantage of interest free periods on your credit card?

This all seems sensible and very reasonable, until he applied for a new investment loan only to discover that his credit rating had been lowered considerably to the point of him being a bad risk! Like the author of today’s SMH story our client had never defaulted or been declared a bankrupt and had been in well-paid secure employment for over 10 years.  His rating was below 700. The ratings are done on a scale from 0-1000, excellent is 800-1000; very good is 700-799; good 625-699; OK 550-624 and below average was zero-549.

The problem? … every time he applied to a credit-card provider for a new loan or a new card, an inquiry was made to the credit data base and each inquiry, while not raising any concerns, stays on your credit rating and affects your credit rating!

The marks you get because you have changed your loan provider or applied for a new credit card stay on your credit rating for five years until they are rolled over.

Michael Evans conclusion to the article he has written about his own credit rating is,

“In a system where the major financial institutions have significant pricing power, credit score cards can feel like they’re stacked against customers trying to encourage competitive behaviour.

Trying to get one back against the banks comes with a cost, and it’s not always in the fine print.”

I agree, and it’s well worth your time to have a look at the full article on this link: http://goo.gl/Uv6eUz

Apr 04
0

What seven property experts wish they knew before investing

By | banking, finance, Financial, Investment, Properties, Property Solutions | No Comments

What Seven Property Experts Wish They Knew Before Investing

What do you need to know before investing in your first property; here is what seven property experts wish they knew before investing.

The service offered by Lime Property Solutions covers all areas you Must have some understanding about before buying your first investment property. The easiest way for you to find out what you need to know is by making an obligation free appointment with one of the investment property experts at Lime.

It’s always interesting to have a look at what some of the people our media dub as ‘experts’ think about what you need to know. Let’s have a look at some of these broad headings.

What seven property experts wish they knew before investing.

Charles Tarbey: The concept of land banking – the chairman of Century 21

“I wish I had better understood the relationship between capital growth and rental return. When I started investing it seemed that the holy grail was to achieve high rental yields from investments. Many people, myself included, sought out high rental returns by buying cheap properties. Looking back, I should not have worried so much about purchase prices and instead tried to find properties in great locations that would see strong capital gains. By using this strategy I would have been able to use the equity from any capital gains to buy more properties and create a larger portfolio”.

Victor Kumar: Ignore the naysayers director of a property group

“If I started over, I would make my goals clearer and more specific. The goals I would set wouldn’t be a number of properties, or a specific location, but would be an income goal that relates to the rental income of an unencumbered portfolio.”

Patrick Bright: Lots of little deals trump waiting for one big one – Director of EPS Property Search

“It’s better to do lots of small deals than to hang out looking for one big one.”

Margaret Lomas: How to use leverage to get you ahead – Author

“I wish I had understood leverage.  Many years ago I sold an owner-occupied property I had in Perth for $175,000 and five years later it was worth $600,000.”

Your big picture becomes affected with every transaction and you want to be sure you don’t look back in the future and regret a decision you made.”

Margaret Lomas is the founder of Destiny Financial Solutions

Terry Ryder: Accumulate property rather than ‘trade’ it – Founder of hotspotting

“I wish I’d understood, back in the 1980s when I first bought property, the importance of holding good real estate and accumulating, rather than trading.”

Nathan Birch: Structure and finance is more important than the property itself – o-founder of BInvested​

“That you don’t have to be an expert in everything but rather just need the experts around you. Having the right team includes accountant, broker, solicitor, financial planner and

 Rich Harvey: Patience to allow capital growth to occur –

“When I first started out in property, the first thing I did was get educated. I used to commute to the city and I’d read a book a day on property. Get as much education as you can. Jumping in and listening to one expert’s opinion and taking action can be quite dangerous – that expert could be a commission-based sales person and they’re not independent or giving independent advice.”

To read the full article on what these experts think go to; http://goo.gl/akp0K1

Follow us on Facebook: https://goo.gl/qlVppi

Twitter: @LimeProperty1

~ Lime Property Solutions

Apr 04
0

Time to Buy and Investment Property

By | banking, best investment, Investment, Market, Properties, Property Solutions | No Comments

It’s Time to Buy an Investment Property

Are you ‘wealthy’ in terms of having a lot of asset and a good income from either your work or asset base or both?  Maybe you don’t think you are wealthy yet but you know somebody you are certain is wealthy.

There is one thing that is almost a certainty that all wealthy people have in common and that is property ownership.

economy

 

In this the land of the fair go, new income distribution figures show how much of the nation’s income ends up with the few. (This blog about “income”, not to be confused with ‘wealth’, which is discussed in a blog below). It’s all part of the same discussion with the world’s growing concern about inequality.

We’re not too bad in Australia but things are certainly getting better for the wealthy and, of course, it is more obvious depending on the area in which you live. Sydney has been revealed as Australia’s most unequal major city in new income distribution figures from the Australian Bureau of Statistics. Read more

If you live in the NT, then 6.5% of total income goes to the top 1%, whereas in NSW 11.4% of income goes to the top 1%. If you live in the CBD, Haymarket and the Rocks then 22.9% of total income is going to the top 1%!

Seem the only way to ensure you are not going to be left behind is to get some good advice on property investment and find out how to develop a performing property portfolio as soon as possible.

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~ Lime Property Solutions

Apr 04
0

Home Loans for the Rich and Home Loans for the Poor!

By | banking, Building, Economy, finance, Financial, Home Loans, Mortgage, mortgage rates, News, Properties, Property Solutions | No Comments

Best Mortgage Rates – Home Loans for the Rich and Home Loans for the Poor!

There seems to be an emerging pattern in the last few blogs – money makes money!

All seems very typical of the banks – always giving out free umbrellas but very quick to take them back if it starts raining!

We seem to be back to a two-tier mortgage and/or investment loan market which is basically working on the principal of the more you can actually afford, the cheaper your loan will be. Of course, the reverse is also true; the less you have in equity or income the more the banks will charge you for your investment loan.

Bottom line is, for anyone with a little bit of equity or savings and a reasonable, steady income, there are still good deals out there and it’s a great time to be buying a good little investment property!
Read more: www.smh.com.au/business/banking-and-finance/banks-get-picky-with-mortgage-deals-rewarding-cashedup-owneroccupiers-20160125-gmdx28#ixzz3yP8wj0DN
Follow us: www.facebook.com/pages/Lime-Property-Solutions/138210849608998

Twitter : @LimeProperty1 |
~ Lime Property Solutions

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