Mortgage Brokers Australia

This website is a reference for Mortgage Brokers Australia wide.  You will find information about home loans, Secured Loans, Mortgage Refinance & Mortgage Refinancing.

Time for a Mortgage Refinance? For many Australians, their home is their biggest asset. It is common for people to reach retirement with significant equity in their home, but without the necessary income to support their lifestyle or to meet their expenses. Often you can use mortgage refinancing in circumstances where your home has been paid off, but you are struggling with your cash flow to cover for debts and expenses.

This is often referred to as being asset rich and income poor. One option available to retirees is to access the equity in their home by taking out Reverse Mortgages, or even 106% Loans!  Faster loan applications are available as Secured Loans. 

Can your Line Of Credit just disappear?  Read our helpful article to improve your financial health.

N.B. ALWAYS get appropriate Investment Advice for this and other types of loan from a professional with accreditation and experience.

March 3, 2010 Mortgage Rates Statement:

*Commentary on the Australia economy revealed greater confidence in the pace of the recovery. “Labour market data and a range of business surveys suggest growth in the economy may have already been at or close to trend for a few months”. And compared to the February statement, there was no caution on the impact of banks raising lending rates by more than RBA and that more time is needed to assess the impact of those increases.

*The Bank makes it clear that it is raising interest rates to a more “average” level as growth is likely to be close to trend and inflation close to the target over the coming year. While this is more of an explanation to why it lifted rates this month than guidance on the future, it does nothing to hose down expectations for a rate rise in April.

*Were it not for recent volatility in the retail sales data, and signs that the NSW housing market may already be adjusting to higher interest rates, we would confidently call a rate hike next month.

*For now, we hold our more pragmatic view on the RBA and look for the Bank to remain on the sidelines in April. Which month the RBA hikes rates is now is data dependent but we are looking for a cash rate of 4.25% by June and 4.50% by September.

*For now, with the economic data tending to come in on the high side of expectations the clear risk to our view lies to the upside and not the alternative.

The interest rate change
With the Australian economy continuing to push forward with signs of economic growth and a global revival starting to take shape, the RBA has raised interest rates for the first time since December last year. A 0.25 per cent increase was announced just minutes ago by the Reserve Board, taking the official cash rate to 4.0 per cent. A number of economic indicators have been improving over the last month helping influence the RBAs decision to lift rates. The unemployment rate has decreased, business confidence has grown and retail sales were up for the start of the 2010.

Looking to the future
Last month, RBA governor Glenn Stevens said that lending rates were around 0.50 per cent to 1.0 per cent below average, suggesting that more interest rates hikes are likely to come this year. As such InfoChoice expects the cash rate to be around 5 per cent come end of the year as the local economy prospers from a global recovery. Home owners will need to prepare for further interest rates hikes and higher mortgage repayments in the near future.

What you can do
One way borrowers can counteract some of the impact of rising interest rates is to check they have the most competitive mortgage for their needs. Check on the MortgageHQ website for updated details.

What are Reverse Mortgages?
Reverse mortgages enable retired homeowners to access the equity in their homes, without having to sell their home. You don’t have to make a monthly repayment. The loan is simply repaid when you cease to occupy your home as a principal residence. This can be when you sell the home, or permanently move out, or the last surviving owner passes away. Instead of making regular repayments, the interest simply gets added on to the total loan amount each month. See our Financial Dictionary for this and other finance terms including Commercial Loans

What can I use the money for?
You can use the proceeds of the loan for almost any worthwhile purpose. Common uses include paying for a vacation or new car, modifying your home (installing a ramp, extending the house), paying off debts, refinance, paying taxes or simply supplementing your retirement income to cover daily expenses. You may also use it for Wealth Creation  or paying off Credit Cards. This credit card comparison helps you to find the best credit card for your needs. Apply online here for the best one

How Much Can I Borrow?
The amount of money you can borrow depends upon the age of the youngest borrower, the value of your home, current interest rates, and where you live. In general, the older you are and the more valuable your home, the more money you can access.

The loans available vary from lender to lender. As a general guide, the minimum age is around 60 years to qualify for this type of loan and you can access around 10% to 15% of the value of your property. As you get older this amount increases to around 45% of the value of your property.

There are no repayments so there is no requirement to prove serviceability of the loan. There are no income or medical requirements to qualify. You may be eligible for a Broker loan even if you still owe money on the property.

How is the Money Paid?
The funds can be advanced as a lump sum or as a regular payment over a number of years (usually around 5 to 10 years). Some lenders offer the option of a Line of Credit that is available for you to draw on as required.

Paying Back Your Loan
The loan is repaid when any of the following happens:

What Happens when the House is Sold?
When the property is sold, the loan is paid out and any surplus funds are paid to your or to your estate. You would be advised to review your will when taking out a Reverse Mortgage to ensure it reflects your current situation.
Can I make Repayments to my Loan?
You will need to check the rules with your chosen lender. However, generally speaking, you can pay off all or part of the loan at any time.

Will rising interest rates affect my loan?
The interest charged to your loan will vary as interest rates rise and fall. Some lenders have fixed rate or capped rate options as well as the normal variable interest rates, so it pays to do your homework first.

Will it Impact my Centrelink Payment?
A reverse Mortgage can potentially affect your income and/or asset position. We strongly recommend you contact Centrelink to discuss your situation before taking out a home loan, Construction Loans, or a commercial loan. Centrelink can be contacted on 13 23 00.

Do I have to give up the title to my home?
This varies from lender to lender. Generally speaking, you would retain 100% ownership of your home. There are schemes available that involve a lender taking part or total ownership of your home. You would be advised to seek professional advise from a solicitor or financial planner before taking this option.

How long can I stay in my home?
Reverse Mortgages generally allow you to stay in your home for as long as you want.  

My advice? Talk to the leaders of the home lending industry that have a reputation for getting results as well as great customer service. My favourite broker for all types of home loans, reverse mortgages or commercial loans is listed below: