Ever thought of improving your borrowing capacity to purchase a 2nd and 3rd property. This tip can potentially help you purchase one more property! Listen and learn :)
If you have not, please go on to: https://www.facebook.com/CWFGroup to watch the corresponding videoblog to see the actual workings on the white board marker. This is part of a video post on how to improve your servicing when applying for a home loan and what to look out for.
Should I fix my investor loan to a P&I fixed rate? And for how long? Hello this is Quang. Welcome to my Keep Calm and Mortgage on Weekly podcast. So I’ve been getting a lot calls from my clients lately about a single question that’s been bugging them since the interest rate rise on investor lending. In particular, the war against interest only lending on investors and now owner occupiers. So the question is: What can I do to reduce my interest rate if banks are just increasing them every week? Here are the calculations: John Smith Example: $1.35 million loan $135k in offset $1,000,000 not offset 1% of $1,000,000 = $51,000 per year or $4250/m – interest only 88% of $1,000,000 = $4705/month – principal and interest repayment Pay $455 extra on P&I repayment but works better because of the 5 mains reasons 5 benefit calculations: $700k loan on 4.7% = $2742/m interest only $700 loan on 4.7% = $3630/m principal and interest Difference is $888 extra on P&I But banks use 25 years loan term ** $700k on 4.7% = $3971/m on 25 years loan term $3971 - $2742 = $1229/m extra on servicing commitment $700k on 3.88% = $3294/m principal and interest repayment $3971 - $3294 = $677 less in servicing commitment ** Please note, the bank will not be able to apply a 3.88% on your existing rate but will have to use 4.7% on the remaining 25 year remaining term because they project what is the worst current rate you have. Unless you already refinanced or changed, then the will use 3.88% in the calculation. Thank you for listening
Why are investor interest rates going up? Just like Netflix subscription prices are going up, interest rates on investors are also going up! Netflix has raised its subscription prices for the first time since it launched in Australia in 2015, thanks to the government's so-called "Netflix Tax", which adds the GST to digital purchases made overseas from places like Netflix and Amazon. Now banks are also raising rates, but not for the first time this year. It’s actually for 4th time this year that they’ve raised rates ahead of the RBA. And there will be more rate rises coming soon, thanks to the government’s so-called ‘Bank Levy Tax’ – to be passed on the 5 major bank banks, Westpac, CBA, ANZ, NAB and Macquarie bank.
The 7 big changes are: The big Bank Levy tax – stay tune on how that affects your current rate The $6.2Bn bank levy that will be passed on to the Big Five Banks. The electricity bill hike in QLD - Queensland government increasing electricity bills in regional queensland The council rates hike in QLD - Councils raising their cost in QLD The land tax surcharge in QLD - Foreign owners of investment property slammed with 1.5% land tax surcharge The Capital gains tax Hike for foreign investors - Foreign tax residents slapped with increase CGT Saying good bye to travel deductions for your investment property – courtesy from the ATO cuts deductions related to travel deductions And Finally some good news, first home buyers access to voluntary superannuation for their first deposit - can access voluntary contribution made into superannuation