Lenders Mortgage Insurance Discounts for Professionals

Buying a property without a 20 percent deposit will usually incur an insurance fee that is to be paid by the borrower. This insurance fee is called Lenders Mortgage Insurance (LMI) and it is a once-off cost that is paid to protect the bank in the event that the borrower defaults on the loan.

This fee can add up in the tens of thousands of dollars and can often be a limiting factor to entering the market sooner. With the challenge of saving enough cash to pay for the deposit plus purchases costs, an added LMI fee can be another hurdle to overcome when trying to enter the property market.

 

Professional Packages

Although rarely advertised, some lenders offer professional packages for specific professions such as Lawyers, Doctors & Accountants. These types of professions are regarded as lower risk for default by the lenders and therefore specific lenders are prepared to waive the entire LMI fee when the applicant has a 10% deposit. This can provide a substantial saving to the qualifying professional and speed up the process of home ownership.

It is important to note that lenders offering these professional packages tend to require certain criteria to be met before granting the waiver such as evidence of industry registration and minimum income thresholds. The requirements differ for each profession and lender so it is important to speak to a broker to understand what you may be able to qualify for.

 

Case Study: Accountant Based in Victoria

John is an Accountant and he meets the qualification and income requirements to be eligible for a Professional Package Waiver.

He has saved enough money to pay a 10% deposit plus purchase costs for a $800,000 property in Victoria. John’s lender of choice are willing to waive the Lenders Mortgage Insurance (LMI) fee of $19,087.00.

Result?

  1. If John wasn’t eligible for this waiver and didn’t have enough cash or enough borrowing capacity to cater for this LMI fee, he would not be able to afford the purchase
  2. By meeting the eligibility requirements, John has saved $19,087.00 and secured the property

A Professional Package Waiver may provide a great opportunity to save thousands of dollars and potentially open up the opportunity to enter the property market sooner. If you are seeking to understand your eligibility, please don’t hesitate to get in touch with the team at 40 Forty Finance.

Why should you use a Mortgage Broker

With many home loan options and products available to everyday consumers, it’s not uncommon to be confused as to which lender might be the perfect fit for you. With strong competition amongst banks, it is important to know that certain lenders may be more favourable to one’s given position as opposed to others.

How do I know who the best lender is for me?

This is where a Mortgage Broker can help. A Mortgage Broker is a financial professional that specialises in finding the very best lending solution for their clients. Their role is to represent the client and be the intermediary between the consumer and the lender. In Australia, more than half of the home loans written are from Mortgage Brokers and with more products coming on to the market each year, the role of a Broker has never been more important. Mortgage Brokers are accredited with multiple home loan providers, and with the increase of second tier lenders amongst the big four (CBA, NAB, Westpac and ANZ), consumers are broadening their scope in the search for the most suitable lender.

So why should you use a Mortgage Broker?

Ensuring you’re getting the best deal

Walking into your local bank branch may be convenient but how do you know if the product they are offering you is the cheapest and most suitable. Mortgage Brokers are accredited with various different lenders and have scope to compare many home loan products against one another. This gives you a platform to make an informed decision that is right for you instead of being subject to one home loan option.

Mortgage Brokers represent the consumer and provide education on products and processes

A Mortgage Broker can be a great sounding board as well as an excellent resource for navigating the complex world of banking. For those that may not necessarily have a lot of experience within this space, a Mortgage Broker can break down the complexities and provide education on the most suitable home loan. In addition to providing information on home loan products and solutions, a Broker’s role is to also ensure that their client has the confidence and knowledge in the purchasing process.

They make the home loan process easy

Mortgage Brokers take the legwork out of time-consuming home loan applications and the complexity that comes with it. The detailed paperwork and requirements by the lender will be explained thoroughly and ensure the client is fully aware of their selected product.

Provide complex lending solutions or alternative lending options

If you wish to utilise some of the equity within your home for renovations, purchases or a holiday then a Mortgage Broker can be used to access these funds. Refinancing to another lender offering a better interest rate is also an important aspect of the day-to-day tasks of a Broker. Interest rates and individual circumstances change frequently so having a Mortgage Broker in your financial team will allow you to be up to date with market rates and options.

With a high level of lending knowledge behind them, Mortgage Brokers should be considered a key member within your financial services team. If you are seeking to purchase a home or thinking about refinancing to another lender, then contact the team at 40 Forty Finance to ensure you have the knowledge and support behind you.

 

When is the right time to buy?

Deciding when the right time is to buy property can be exceptionally overwhelming and challenging. In a world where information and social pressures are never too far away, the decision about when to buy is typically made more confusing and complex than what it really is. The extensive amount of information and influencing factors can not only lead to stagnation and stress but also hinder progress through the purchasing journey.

For those deciding about when to purchase their first home, there are some key considerations that need to be understood when embarking on this process.

Buy when you are financially ready

Investing in property is typically the greatest expense in one’s life so being aware of the monetary outlay and ongoing commitments is critical in determining whether you are ready to buy or not. It is exceptionally difficult to predict future market conditions, interest rate changes and property growth so if you are in a position to buy, and you have been Pre-Approved, then look to make an offer if you have come across a desirable property. If you feel any hesitation in the outlay then you may not be financially or psychologically ready to make the leap. It’s a common occurrence where social pressures of friends and family expectations can push someone into thinking they are ready to purchase when this might not be the case. Buying in your own time is the key to ensuring you are entering the market at comfortable time in your life.

Property is for the long term

Adopting the mindset that property is a long-term game is a sensible approach. The large outlay of initial fees such as stamp duty, settlement fees, pest and building inspection fees need to be considered when planning how long you intend to hold on to the property. Property is not a ‘get-rich quick’ scheme and most often you will have to wait several years before capital growth breaks even to the initial financial outlay. Having a five-year minimum approach allows enough time for the property to grow in value and for also personal circumstance to change requiring an upgrade.

Market rises and falls

Be careful not to be overly analytical when trying to time your purchase with current market conditions. This is because the property market tends to operate in cycles of rising and falling. Economic changes are inevitable so minor fluctuations in market ups and downs tend to even out over time. Historically, the performance of property has shown tremendous results so adopting a ‘buy when ready approach’ is a far better method than trying to time the market.

Purchasing a property takes a lot of financial and emotional investment so being comfortable and certain that the timing is right for you is key when looking to buy. If you believe that you may be in a position to buy your first home then be sure to get in contact with the team at 40 Forty to map out a home loan and purchasing plan.

Is now a good time to refinance my mortgage?

Banks are continuing to fight hard for business amidst the current Covid-19 pandemic with many lenders offering the lowest interest rates in Australian history. Further to exceptionally low interest rates, some lenders are offering cashback offers of up to $4,000.00 when those refinance their investment loan or home loan. The Reserve Bank of Australia (RBA) final interest rate decision for 2020 has seen the cash-rate remain on hold at a record low of 0.10 per cent. Lenders pass on rate cuts in a variety of ways, however, the majority of lenders are currently dropping their rates on their fixed term products.

What does it actually mean to refinance?

Refinancing simply means to switch your home loan from one lender to another. This is commonly done when consumers look to secure a lower interest rate at a new bank or decide to restructure their loan. In Australia, the average term of a home loan at one lender is 4.5 years. Since the maximum typical home loan in total will last for 30 years, refinancing is more common that you may think. We see it as a savvy way to ensure that you have the lowest interest rate possible throughout the entire term of your loan.

What needs to be considered before I choose to refinance my home loan?

The process of refinancing is relatively straight forward however there are some important considerations that need to be understood before an application commences. Like all new finance applications, the lender will want to know if you can service (afford) your loan. Evidencing reliable and steady income is a very important aspect of applying for finance so if you are currently between jobs or unemployed then you may have wait until you can prove a consistent and steady income stream.

Refinancing almost always occurs when the loan to value ratio (LVR) is below 80%. LVR is a ratio between the amount owing on your loan to the value of your property. In the context of lending and refinancing, if the LVR is greater than 80% then you will be required to pay lenders mortgage insurance, and this is most often an immediate barrier to refinancing.

How much does it cost to Refinance?

When you are refinancing, it is important to weigh up the savings against any costs of making the move to a new lender. The likely fees to be incurred are:

  • Government registration of your new lender against your title – $250.00
  • Discharge Fee from your current lender – $250.00 – $350.00
  • New Annual Fee at the new lender – $250.00 – $370.00
  • Fixed-Rate break fee – This figure is a complex calculation that your current bank determines using the remaining loan balance, remaining fixed term and interest rate differential. This is a figure that is only obtained from the outgoing lender.

How Long does it take to Refinance my Loan?

From start to finish, refinancing a loan can take anywhere from 3-8 weeks. This is all dependent on the lender assessment time as well as the applicant’s efficiency in gathering the necessary documents.

Are there any downsides to refinancing?

Changing lenders means that you will need to go through a new credit assessment to ensure you are able to service (afford) the new debt. Due to the creation of new accounts with the new bank, you may need or want to notify any employers about the change of account details so you can receive your remuneration in that particular account. On a positive note, if your direct debits are coming out of an existing offset account, this account will remain active at your current bank (as a savings account) when you refinance. This means that you don’t have to worry about missing any direct debit payments while you get things set up at your new lender.

How do I know what lending options are out there?

Refinancing can be a serious financial decision with many variables to consider. If you would like to understand whether this is possible for you then be sure to get in contact with the team at 40 Forty Finance to undergo a home loan health check and gain the valuable information required to make the right decision.

 

Retail banks wake up to digital lending this year

Overview

Majority have suffered alteration in some form, by injected humour or good day randomised words which don’t look even slightly believable. If you are going to use a passage of lorem Ipsum, you need to be sure there isn’t anything make embarrassing hidden in the middle of text.

Consulting represents success at realizing the company is going in the wrong direction. The only time the company fails is when it is not possible to do a turnaround anymore. We help companies pivot into more profitable directions where they can expand and grow. It is inevitable that companies will end up making a few mistakes; we help them correct these mistakes.

Problems

Majority have suffered alteration in some form, by injected humour or good day randomised words which don’t look even slightly believable. If you are going to use a passage of lorem Ipsum, you need to be sure there isn’t anything make embarrassing hidden in the middle of text.

Solution

Suffered alteration in some form, by injected humour or good day randomised words which don’t look even slightly believable. If you are going to use a passage of lorem Ipsum, you need to be sure there isn’t anything make embarrassing hidden in the middle of text.

0 %
Increase Integration
0 %
Business Growth
0
Number of Sales

What Client Say

“Cognition-based coaching and consulting approach, we facilitate your business growth from small to size from mid-size to global or from crisis to success.
Robert Brown
Business Owner
“Cognition-based coaching and consulting approach, we facilitate your business growth from small to size from mid-size to global or from crisis to success.
Ruko Bendo
Business Owner

Within the construction industry as their overdraft

Overview

Majority have suffered alteration in some form, by injected humour or good day randomised words which don’t look even slightly believable. If you are going to use a passage of lorem Ipsum, you need to be sure there isn’t anything make embarrassing hidden in the middle of text.

Consulting represents success at realizing the company is going in the wrong direction. The only time the company fails is when it is not possible to do a turnaround anymore. We help companies pivot into more profitable directions where they can expand and grow. It is inevitable that companies will end up making a few mistakes; we help them correct these mistakes.

Problems

Majority have suffered alteration in some form, by injected humour or good day randomised words which don’t look even slightly believable. If you are going to use a passage of lorem Ipsum, you need to be sure there isn’t anything make embarrassing hidden in the middle of text.

Solution

Suffered alteration in some form, by injected humour or good day randomised words which don’t look even slightly believable. If you are going to use a passage of lorem Ipsum, you need to be sure there isn’t anything make embarrassing hidden in the middle of text.

0 %
Increase Integration
0 %
Business Growth
0
Number of Sales

What Client Say

“Cognition-based coaching and consulting approach, we facilitate your business growth from small to size from mid-size to global or from crisis to success.
Robert Brown
Business Owner
“Cognition-based coaching and consulting approach, we facilitate your business growth from small to size from mid-size to global or from crisis to success.
Ruko Bendo
Business Owner

Retail banks wake up to digital lending this year

Overview

Majority have suffered alteration in some form, by injected humour or good day randomised words which don’t look even slightly believable. If you are going to use a passage of lorem Ipsum, you need to be sure there isn’t anything make embarrassing hidden in the middle of text.

Consulting represents success at realizing the company is going in the wrong direction. The only time the company fails is when it is not possible to do a turnaround anymore. We help companies pivot into more profitable directions where they can expand and grow. It is inevitable that companies will end up making a few mistakes; we help them correct these mistakes.

Problems

Majority have suffered alteration in some form, by injected humour or good day randomised words which don’t look even slightly believable. If you are going to use a passage of lorem Ipsum, you need to be sure there isn’t anything make embarrassing hidden in the middle of text.

Solution

Suffered alteration in some form, by injected humour or good day randomised words which don’t look even slightly believable. If you are going to use a passage of lorem Ipsum, you need to be sure there isn’t anything make embarrassing hidden in the middle of text.

0 %
Increase Integration
0 %
Business Growth
0
Number of Sales

What Client Say

“Cognition-based coaching and consulting approach, we facilitate your business growth from small to size from mid-size to global or from crisis to success.
Robert Brown
Business Owner
“Cognition-based coaching and consulting approach, we facilitate your business growth from small to size from mid-size to global or from crisis to success.
Ruko Bendo
Business Owner

Within the construction industry as their overdraft

Overview

Majority have suffered alteration in some form, by injected humour or good day randomised words which don’t look even slightly believable. If you are going to use a passage of lorem Ipsum, you need to be sure there isn’t anything make embarrassing hidden in the middle of text.

Consulting represents success at realizing the company is going in the wrong direction. The only time the company fails is when it is not possible to do a turnaround anymore. We help companies pivot into more profitable directions where they can expand and grow. It is inevitable that companies will end up making a few mistakes; we help them correct these mistakes.

Problems

Majority have suffered alteration in some form, by injected humour or good day randomised words which don’t look even slightly believable. If you are going to use a passage of lorem Ipsum, you need to be sure there isn’t anything make embarrassing hidden in the middle of text.

Solution

Suffered alteration in some form, by injected humour or good day randomised words which don’t look even slightly believable. If you are going to use a passage of lorem Ipsum, you need to be sure there isn’t anything make embarrassing hidden in the middle of text.

0 %
Increase Integration
0 %
Business Growth
0
Number of Sales

What Client Say

“Cognition-based coaching and consulting approach, we facilitate your business growth from small to size from mid-size to global or from crisis to success.
Robert Brown
Business Owner
“Cognition-based coaching and consulting approach, we facilitate your business growth from small to size from mid-size to global or from crisis to success.
Ruko Bendo
Business Owner

Retail banks wake up to digital lending this year

Overview

Majority have suffered alteration in some form, by injected humour or good day randomised words which don’t look even slightly believable. If you are going to use a passage of lorem Ipsum, you need to be sure there isn’t anything make embarrassing hidden in the middle of text.

Consulting represents success at realizing the company is going in the wrong direction. The only time the company fails is when it is not possible to do a turnaround anymore. We help companies pivot into more profitable directions where they can expand and grow. It is inevitable that companies will end up making a few mistakes; we help them correct these mistakes.

Problems

Majority have suffered alteration in some form, by injected humour or good day randomised words which don’t look even slightly believable. If you are going to use a passage of lorem Ipsum, you need to be sure there isn’t anything make embarrassing hidden in the middle of text.

Solution

Suffered alteration in some form, by injected humour or good day randomised words which don’t look even slightly believable. If you are going to use a passage of lorem Ipsum, you need to be sure there isn’t anything make embarrassing hidden in the middle of text.

0 %
Increase Integration
0 %
Business Growth
0
Number of Sales

What Client Say

“Cognition-based coaching and consulting approach, we facilitate your business growth from small to size from mid-size to global or from crisis to success.
Robert Brown
Business Owner
“Cognition-based coaching and consulting approach, we facilitate your business growth from small to size from mid-size to global or from crisis to success.
Ruko Bendo
Business Owner

Within the construction industry as their overdraft

Overview

Majority have suffered alteration in some form, by injected humour or good day randomised words which don’t look even slightly believable. If you are going to use a passage of lorem Ipsum, you need to be sure there isn’t anything make embarrassing hidden in the middle of text.

Consulting represents success at realizing the company is going in the wrong direction. The only time the company fails is when it is not possible to do a turnaround anymore. We help companies pivot into more profitable directions where they can expand and grow. It is inevitable that companies will end up making a few mistakes; we help them correct these mistakes.

Problems

Majority have suffered alteration in some form, by injected humour or good day randomised words which don’t look even slightly believable. If you are going to use a passage of lorem Ipsum, you need to be sure there isn’t anything make embarrassing hidden in the middle of text.

Solution

Suffered alteration in some form, by injected humour or good day randomised words which don’t look even slightly believable. If you are going to use a passage of lorem Ipsum, you need to be sure there isn’t anything make embarrassing hidden in the middle of text.

0 %
Increase Integration
0 %
Business Growth
0
Number of Sales

What Client Say

“Cognition-based coaching and consulting approach, we facilitate your business growth from small to size from mid-size to global or from crisis to success.
Robert Brown
Business Owner
“Cognition-based coaching and consulting approach, we facilitate your business growth from small to size from mid-size to global or from crisis to success.
Ruko Bendo
Business Owner