The question being asked of Mortgage Brokers Australia – Should I fix or not?

Tip from Mortgage Brokers Australia:

Fixing a mortgage ensures consistent monthly repayments no matter what the Reserve Bank does with mortgage interest rates!

Mortgage Brokers Australia says the rise in the popularity of fixed-rate homeloans reflects increasing consumer concern about the future of mortgage interest rates.
A recent monthly mortgage index for Mortgage Brokers Australia showed that it’s new lending proportion of fixed mortgages increased by 10% during 2010. Other lenders and brokers are experiencing the biggest demand for fixed rates in almost three years with one reporting the level of demand reaching 15.2 per cent of its approvals in December.

Home Buyers and Mortgage Holders are turning to fixed rate mortgages in response to the steady rise in mortgage interest rates that we experienced last year and predictions are that rates will go even higher this year. The Reserve Bank cash rate reached a low point of 3 per cent in April 2009 and started rising six months later. Since then it has gone up to 4.75 per cent, with the most recent change being last November.

Mortgage Interest Rates are on hold for now but economists and Mortgage Brokers Australia expect the next move to be up.

ANZ’s forecast is for the Reserve Bank’s cash rate to rise from the current level of 4.75% to 5.5% by the end of 2011. Commonwealth Bank agrees that the cash rate will reach 5.5% by year end and NAB is forecasting 5.25%.

Mortgage Brokers Australia suspects that if the bank’s economists are correct, a possible scenarion this year is that the Reserve Bank Cash Rate may increase by at least 0.50%.

Another issue to consider is, how will lenders respond in the midst of further Reserve Bank increases this year? It was reported that only five out of 99 lenders recently surveyed, pegged their variable home loan rate increases to that of Reserve Bank last year. In November, when the Reserve Bank put up rates by 0.25 of a per cent, the average home loan rate increase was 0.32 of a per cent. Therefore there is also the possibility that lenders may add something on top of any RBA increases, just like they have done before.

Mortgage Brokers Australia – To fix or not to fix in 2011?

The standard variable home loan rates offered by the big banks start with NAB at 7.67%, ANZ and St George 7.8%, Commonwealth 7.81% and Westpac at 7.86%. Many borrowers who have sourced their homeloan from one of the major banks will more than likely be receiving a package discount of around 0.6% resulting in their mortgage interest rate being around 7.10 – 7.20%. Some lenders may offer larger discounts with the Refinance Mortgage Loan Broker (Refinancing Group Australia) offering package discounts of 0.90% to 1.00%.

With some fixed rates being offered at the same level as (or lower than) variable rates, borrowers appear to have little to worry about by opting for a fixed rate mortgage or part fixed rate mortgage. At the time of writing a prominent Sydney Mortgage Manager (CommunityBE$T) was offering a market leading 2yr Fixed Rate of 6.86% (For more info contact our Finance Centre on 1300 448 911).

Borrowers may have to pay a new establishment fee if changing lender to obtain the most suitable fixed rate, but they may end up with a fixed rate loan that has a lower variable rate than they are paying now and if rates do move up this year as predicted, they could well be further ahead.

Tip from Mortgage Brokers Australia:

Borrowers need to remember that, fixed rate homeloans are generally inflexible i.e. Monthly payments cannot be varied and there is no redraw or offset facility.

Borrowers need to note that fixed rate mortgages have different characteristics and features than that of variable rate mortgages and to avoid any problems that might arise from the inflexibility of a fixed rate and/or applying a fixed mortgage interest rate to the whole of their mortgage, they should seek advice from a mortgage planner or Mortgage Brokers Australia that has extensive mortgage broking experience.

A popular option is that of a Split Loan (part variable and part fixed) which offers some protection from rate increases and allows additional payments to be made into the variable portion. Being able to make extra repayments is an important facility as these payments serve two purposes, they create a surplus that can be called upon in emergencies and they speed up the repayment of the loan reducing the amount of interest payable. 48 per cent of home loan borrowers make extra repayments on their homeloans.

If you would like to discuss your fixed rate homeloan options and/or find out more about the Community Best Home Loans 2yr fixed rate of 6.86% or Refinancing Group Australia’s 0.90% discounts , please contact a Finance Centre Consultant on 1300 448 911.

“Get the right advice about Mortgage Interest Rates” 
Refinancing Group – Mortgage Brokers Australia.

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REFINANCING GROUP – Mortgage Refinancing Process

Mortgage Refinancing Process & Procedures – Application to Settlement  

Step 1: Mortgage Refinancing Credit Application
Following a phone or face-to-face interview with your Mortgage Refinancing Group Australia Refinance Mortgage Broker / Mortgage Planner, you have decided to apply for a particular homeloan for the purposes of refinancing a mortgage. You will now be required, with the assistance of your Mortgage Refinancing Group Representative to complete a credit application form relevant to the home loan lender or mortgage manager that supports the particular homeloan you have selected. Along with your credit application you must supply documents that support your Identification, Loan Purpose, Credit History and Financial Data.

On receipt of the above your Mortgage Refinancing Group Representative will prepare your personal client file along with your credit application pertinent to the selected lender’s requirements and then lodge your application with that lender.
You will receive notification from us that your credit application has been lodged when we receive from the lender confirmation of receipt of your application.

Step 2: Conditional Approval
On receipt of your mortgage refinancing application the lender will apply their normal credit application processes involving acquiring a credit report, checking credit history, confirming employment & residence status, assessment of income, assets & liabilities. Provided your application satisfies their credit criteria, they will issue a Conditional Credit Approval. There are usually one or more conditions outlined within the approval, the most common being subject to satisfactory valuation of the security property.

Most lenders have a 3 day turnaround for issue of a conditional approval however this can extend out to 5 – 7 days in peak periods. We will notify you of the granting of Conditional Approval along with the conditions noted within. Some input maybe required from you to satisfy some of the approval conditions, therefore your assistance at this point is vital to ensure the fluent processing of your mortgage refinancing application.

Step 3: Valuation Ordered
At the time of conditional approval, the lender will order a valuation assessment of the security property to establish a value of 90 day saleability and ensure that it also meets with their lending criteria. Lenders will instruct their panel valuer to carry out either a book valuation, drive-by valuation or walk through valuation depending on the specifics of your application.

 Depending on the type of valuation assessment ordered, it will take between 1 – 3 working days for the completed valuation to be returned to the lender. In the case of a walk through valuation, delays can occur due to difficulty of gaining access to the security property caused by real estate agents, property managing agents or tenants. Your assistance in preparing your agent and/or tenant for the valuer’s visit is vital in ensuring the continued fluency of your application.

 Some lenders may choose to order the valuation assessment before conditional approval to enhance the speed of application processing. Because the valuation assessment is such a critical step in the application process, Mortgage Refinancing Group adheres to a practice of ordering the valuation assessment up front prior to your mortgage refinancing application being lodged with the lender.

We will notify you when the valuation assessment has been ordered.  

Step 4: Valuation Returned
When the valuation report is returned to the lender, if the assessed value is greater than or as expected, then the details of the security property will be checked for compliance with government authorities and credit criteria. If compliance is met your application will be recommended for Unconditional Approval provided all prior loan conditions have been met.

If the valuation is lower than expected but still within acceptable limits, the lender will request us to consult with you and confirm if any adjustment of the loan amount is required and/or you have agreed to any extra costs that may be resultant from the lower valuation. In the case of a higher valuation amount you may request a higher loan amount, and if so, serviceability may need to be re-assessed to ensure that you can still service the higher debt.

Step 5: Unconditional Approval
Provided that all loan conditions have been met and credit criteria satisfied, the lender is in a position to issue an Unconditional Approval for your Mortgage Refinancing Application. If there are no outstanding conditions, Unconditional Approval is usually granted within 48 hrs from receipt of the valuation assessment.

Mortgage Refinancing Group will notify you of Conditional Approval the same day it is granted and also check with you that there are no last minute alterations required to your loan approval, loan features and/or loan set up.

At this point some lenders will issue a Letter of Offer which they require the borrowers to accept by signing and returning a copy of the offer within 7 days.

Step 6: Homeloan & Mortgage Documentation Issued
As soon as your application is unconditionally approved (and a signed copy of the Letter of Offer has been returned), the lender will issue instructions to their appointed Settlement Agent to prepare your Homeloan and Mortgage Documentation Kit which will include the following documents:

  • Loan Contract
  • Mortgage Document
  • Memorandum of Acceptance
  • Terms & Conditions
  • Disbursement Authority
  • Plus other Ancillary Documents

Mortgage Refinancing Group will notify you that the Homeloan & Mortgage Documentation has been issued. If you don’t receive the documentation within 48 hrs after notification, it is important that you inform us so that we can follow it up.

Before issuing the documentation kit the appointed Settlement Agents will carry out a title search of the security property for confirmation that the title holders and borrowers are the same or in sync.

At this point Mortgage Refinancing Group will lodge your Discharge Authority with your existing lender, as they may require up to 10 working days to retrieve your Security Packet which contains your Certificate of Title as well as prepare themselves or their agents for the discharge of their mortgage.

Step 7: Documentation Signed & Returned
Each borrower will be issued with a copy of the Homeloan & Mortgage Documentation for their immediate reference and to be retained for their own purposes. The original copy for signing will be issued to the nominated borrower or nominated borrower’s legal representative/conveyancer.

Each borrower is usually given the option of signing the documentation with or without legal advice. At times a lender may insist on the borrower/s obtaining some form of advice before signing the documentation. A Mortgage Refinancing Group Representative will be available to go over the documentation with you and recommends that you avail yourself of this service whether you are seeking legal advice or not.

When and only when you are happy with the explanation of the documentation and its contents, sign the documents where indicated and return them directly to the lender’s settlement agent with any other requested documentation. Alternatively you may return the signed documentation to us so that we may check it for correctness before returning same.

On receipt of the signed documentation, the lender’s settlement agent will contact your current lender/mortgagee to obtain a payout figure and provided the payout figure is within the limits of available funds will proceed to book a suitable settlement date. Please note that any errors with the payout figure will delay the settlement.

Step 8: Settlement Booked
The lender will book a time to settle the mortgage refinancing transaction in conjunction with your solicitor or conveyancer (if you have one acting on your behalf) and/or with your existing lender’s discharge department. We will inform you of the settlement date.

You may be asked to supply additional monies in the form of a bank cheque for settlement proceeds if additional cash is required to complete the mortgage refinancing transaction. We will be advised of this by the settlement agent or lender and will contact you if so.

Step 9: Settlement
Provided that there are no unforeseen delays, settlement will take place on the arranged day. We will inform you when settlement has taken place.

Step 10: Post-Settlement
Your Mortgage Refinancing Group Representative will contact or meet with you to ensure that all accounts have been set up correctly and that you are aware of your first repayment date. Most lenders will supply you with a customer service or homeloan service contact number for post settlement assistance.

I hope you found this article to be of value. If you have any queries in regards to the information contained within, please contact our Finance Centre and speak with one of our knowledgeable and friendly consultants.  Phone 1300 448 911.  

Save Money when Mortgage Refinancing
Mortgage Refinancing Group Australia – Mortgage Refinancing Specialists

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Mortgage Interest Rates to hit 9.5pc

Mortgage Interest Rates 9.5pc within 3 years

Mortgage Interest Rates are expected to hit 9.5% within three years, according to BIS Shrapnel. Speaking at a recent media luncheon, BIS Shrapnel chief economist and director of economics and property Frank Gelber, said mortgage interest rates would hit 9.5 per cent by the end of 2013.

“We were critcised a couple of years ago when we said mortgage interest rates would hit 10% because nobody ever thought they would get that high again. While they never got to 10 per cent, they did surpass 9 per cent pretty quickly,” he said.

According to Mr Gelber, mortgage interest rates will once again surpass 9 per cent as Australia continues to recover post the Global Financial Crisis. Mr Gelber’s comments were largely echoed by AMP’s chief economist Shane Oliver, who indicated that standard mortgage interest rates could tip 8.5% within just one year. “I think the RBA were right to signal further rate increases and I expect the official cash rate to hit 5.5% before December 2011, which would take the standard mortgage interest rate to approximately 8.5%,” Mr Oliver told The Adviser.

Author: Jessica Darnbrough (The Adviser)

……………………………………………………..

Rising Mortgage Interest Rates

Are you being spooked by rising mortgage interest rates, high petrol prices and continual increases in the cost of living? Mortgage Interest Rates are expected to hit 9.5pc within 3 years. Are you being spooked by rising mortgage interest rates?
Is the cash left in your pocket at the end of the week becoming less as each month passes?

Well now may be the time to review your mortgage and consider the benefits to be gained from rearranging your finances, consolidating your debts, refinancing to a more interest rate competitive mortgage product and/or switching to the comfort of a fixed interest rate mortgage.

With a correct understanding and application of both fixed interest rates and premium product features a user can reap great benefit from their homeloan along with certainty of cashflow even within a rising interest rate environment. Fixed mortgage interest rates and premium mortgage products should be key components of your homeloan within a rising interest rate environment.

The educating and advising of borrowers in the efficient application of homeloans and their features along with associated financial services is the key difference in our service as compared to that of a standard mortgage loan broker or homeloan lender.

“Past and present clients tell us that as a result of our home loan, mortgage refinancing service they were better informed and advised about the procedures of refinancing a home as well as the technicalities of home loan features and products, and achieved far better lifestyle satisfying and financially beneficial results then from previous mortgage broker, lender relationships!”

To discover how much better your mortgage and/or finances can be, phone and speak with one of our Finance Centre Consultants about a complimentary review of your current finances and mortgage interest rates.

Phone Now on 1300 448 911 or email us and we will call you!

Better Mortgage Interest Rates!
Mortgage Refinancing Group Brokers Australia

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Ten Questions to Ask a Refinance Mortgage Broker!

Ten questions to ask a Mortgage Loan Broker to make sure that they offer the right Refinance Mortgage Broker Service for you:

1. What range of lending institutions do you as a Refinance Mortgage Broker have on your lending panel?
Make sure that the person you are dealing with is a Mortgage Loan Broker or Mortgage Planner who has access to a panel of lenders as opposed to a Mortgage Representative who only represents one lender and that lender’s range of products.

2. What is the best type of homeloan that would suit my cashflow cycle and financial structure?
Make sure that the refinance mortgage broker or mortgage planner demonstrates how the particular type of homeloan will support your financial structure and maximise the use of your cashflow. It is important that the manner in which the home loan repayments are required to be made does not restrict the effective use of your cashflow in minimising the amount of mortgage interest payable.

3. Is it best to concentrate on the mortgage products with the lowest mortgage interest rates?
If the answer is a definite yes, ask why and proceed with caution! There is nothing wrong with low mortgage interest rates provided the lender displays a track record of low interest rates and stable funding! Mortgage products that seem to offer a great deal may contain high penalties, fees and charges, or may not offer the flexibility of use that you require in the future.
To avoid taking out a loan you might later regret, treat with caution a recommendation based mainly on low interest rates.

4. What are the best mortgage loan products to suit my immediate circumstances and goals, and how will they support any future goals I may have?
Make sure the refinance mortgage broker recommendation includes at least 3 mortgage products that have fair comparisons between the products. Beware of a comparison that contains 1 product that appears to be far superior to the other 2! Look for product features and product flexibility that will enable you to adjust the mortgage loan product to meet your future goals and plans.

5. Apart from the fees and charges associated with the new loan, what other fees and charges am I likely to incur?
Financial Institutions, Service Providers and Government Departments often charge fees associated with the lending process and at times can be an expensive surprise for the unwary. A worthwhile Mortgage Loan Broker or Mortgage Planner will supply you with a Loan Costing Sheet itemising all costs, fees & charges associated with the intended loan process.

6. How do you get paid and what is your payment/commission structure?
Requesting an explanation in writing of how your service provider gets paid for their work will help identify and minimise conflicts of interest. If the recommended Lender’s payment or commission is by far the highest remuneration of all lenders on the broker’s lender panel, proceed with caution as this may represent a conflict of interest.

7. Do you present your customers with a Mortgage Broking Agreement?
Not every Refinance Mortgage Broker’s service is explicit in what it will deliver as compared to what it is that you require as an end product. Therefore it is highly recommended that a Mortgage Broking Agreement be drawn up between the parties outlining the scope of services/products to be provided and fees/payments associated with the work.

8. Do you carry out FREE Annual Reviews and what other services do you offer?
Find out how keen the broker is to stay in contact with you and check that your mortgage is meeting with your requirements. What other services does the broker offer either directly or via referral that may be of benefit to you and are there discounts available if you bundle these services with that of the mortgage?

9. Where can I turn if we have a disagreement that cannot be resolved? Do you have an External Dispute Resolution Service (EDRS)?
Ask the service provider to explain the complaints process offered by their business, outlining who you can complain to and which EDRS they are a member of? A worthwhile Refinance Mortgage Broker will present you with a personalised Financial Services Guide at first meeting which will outline all the details of their complaints process as will their Mortgage Broking Agreement.

10. Are you an MFAA certified Mortgage Loan Broker?
By dealing with a broker who is a certified MFAA member, you are dealing with a broker that has satisfied minimum standards of education, experience and ethics to maintain their membership status.

The author of this article, Kevin Roby is the Professional Credit Advisor and Senior Mortgage Planner at Mortgage Refinancing Group Australia and a leading Refinance Mortgage Broker known for his Mortgage Refinancing Tips & Strategies that greatly benefit many Australian homeowners with the successful management of their mortgages.

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Will Low Mortgage Interest Rates save you the most amount of money?

Understanding Mortgage Interest Rates

Research has found that there are more people, active in the property market today than ever before and needing assistance in understanding the often complex mortgage interest rates, mortgage loan products and mortgage implementation processes involved with purchasing a property and/or mortgage refinancing.

Unfortunately at times, people get caught up in the excitement of buying a home (which also at times involves refinancing a home) and consequently the finer details of their mortgage loan (the mechanics of the mortgage) are overlooked and/or not well understood, which often leads to problems or disappointment down the track. Young people (due to inexperience and/or over confidence and at times being overzealous) are especially in danger of entering into mortgage loans that don’t represent the most beneficial deal for them.

Comparing home loans is not as simple as comparing mortgage interest rates.

People need to, be focused and diligent when researching mortgage loans and mortgage interest rates, and not strictly rely on previous relationships with a mortgage loan broker or financial institution when selecting a mortgage or requiring help with the mortgage implementation process. It’s important to understand that familiarity does not always support good results!

It’s also important for intending borrowers to understand that comparing homeloans or mortgages is not as simple as comparing mortgage interest rates alone, and they should not become over enthused by marketing from lenders and/or mortgage loan brokers over singing the virtues of cheap mortgage interest rates. The level of service and convenience offered by a lender; flexibility of repayments, loan term and loan account structure within the mortgage loan facility; availability of loan features and complimentary financial services MUST also be considered.

Most important, does the lender or mortgage loan broker display the same mindset as that of a mortgage planner who focuses purely on finding the most suitable combination of mortgage loans, mortgage interest rates and financial services that will save you the most amount of money and assist you to own your home in the shortest possible time.

Cheap mortgage interest rates invariably deliver short term benefits.

Cheap mortgage interest rates are important but invariably deliver short term bAre mortgage interest rates important? Do low mortgage interest rates save you the most amount of money? enefits as interest rates will fluctuate regularly during the life of the loan plus there is no guarantee that all lenders interest rates will fluctuate by the same amount. It is also important to remember that interest rates fluctuate as a result of either the whim of the lender, international monetary policy or government fiscal policy, neither of these which you have control over. Therefore your ability, through the flexibility and availability of structure and features within your mortgage loan, to counteract and benefit from these mortgage interest rate fluctuations is VITALLY important and will serve you better, saving you the most amount of money during the time you have your loan.

The Mortgage & Finance Association of Australia (MFAA) recently launched a national awareness campaign (supported by their mortgage loan broker members) to help those requiring a mortgage, better understand exactly what it is they are getting into when taking on a new mortgage loan or mortgage refinancing.

For better advice about mortgage interest rates and assistance with arranging your next mortgage, consider the services of an MFAA approved Mortgage Loan Broker who is skilled and knowledgeable in the procedures of Mortgage Planning.

MFAA Full Member 56258
Refinancing Group – MFAA Approved Mortgage Loan Broker

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Home Loan Refinancing – Consider the services of a Mortgage Planner.

Obtain 2nd Home Loan Refinancing Opinion

When home loan refinancing the majority of homeowners opt for the services of a familiar local lender or the financial institution that holds their savings accounts or their trusted mortgage broker without giving a thought to obtaining a 2nd home loan refinancing opinion. If you are one of those that follows this mode, how can you be certain that you have received the most appropriate mortgage refinancing advice and/or mortgage interest rates recommendation, if you don’t at least obtain a 2nd home loan refinancing opinion?

It is vitally important to the overall success of the home loan refinancing transaction that homeowners obtain a 2nd opinion.

Befoe home loan refinancing obtain a 2nd opinion from a mortgage planner to ensure the proposed home loan refinancing plan is in line with your expectations.For a quality comparison they should obtain a 2nd opinion from a mortgage refinancing specialist who is separate and distinct from the local lender, bank or mortgage broker, as obtaining a 2nd opinion from like minded people will deliver like minded results.

A Mortgage Planner is similar to the above in that they offer assistance with home loan refinancing but as a mortgage refinancing specialist they offer a service that is very distinct from that of a lender or mortgage broker. A Mortgage Planner will not only assist you to obtain a suitable home loan facility but will also assist you to effectively use the financial products and features within that home loan facility in a manner that will represent the lowest overall cost for your situation. A Mortgage Planner will make certain that the homeloan facility is structured to assist you in effectively managing your cashflow, while eliminating mortgage debt and building wealth as quickly as possible without compromising your lifestyle.

A Mortgage Planner will present you with an itemised quality comparison highlighting the future as well as the present home loan refinancing benefits & savings.

Lenders and Mortgage Brokers alike generally present their clients with a basic upfront loan cost and mortgage interest rates comparison whereas a Mortgage Planner will present their clients with an itemised Mortgage Plan which includes a Home Loan Refinancing Recommendation supported by a Lender, Product & Repayment System Comparison; Detailed Lender & Product Information; Interest Savings & Benefit Highlights; Debt Consolidation Comparison (if applicable); Amortisation Schedule, Cost Analysis, Borrowing Capacity and Preliminary Loan Application Assessment. 

Then as an ongoing service a Mortgage Planner will annually review your situation and progress associated with the operation of the homeloan facility.

If you would you like to receive a better understanding of your home loan refinancing options and specialist homeloan advice specifically tailored towards you paying the least amount of compounding mortgage interest and effectively owning your home in the shortest possible time, contact a Mortgage Refinancing Group Mortgage Planner for a quality objective 2nd opinion.

To find out more about Home Loan Refinancing and/or Refinancing Group’s Mortgage Planning Service give us a call on 1300 448 911 or email your contact details to enquiry@refinancinggroup.com.au and we will contact you.

“Get the right advice on home loan refinancing” 
Refinancing Group – The Mortgage Refinancing Experts.

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