Winter News

#brokerbehindyou #canberrafinancebroker #keepingthebankshonest

Well winter certainly arrived with a smack, which is awesome for those ski bunnies! What a wonderful Autumn we had though.

So with another RBA cut yesterday we have seen our cash rate fall to absolute record lows. No one that I have spoken to remembers a time when they were this low. The only time I have ever seen it, is in a car yard, even then it had barnacles on it.

Surely most of the banks will pass on this rate cute cut. Some of them held a bit back last month I think there will be little empathy for those that don’t this time.

It certainly makes it a great time to revisit your mortgage and make sure that your lender is doing the right thing by you. Even looking at a fixed rate, One could expect with the economic outlook presented by Mr Lowe and other economists, that a rate rise isn’t arriving any time soon.

In Canberra housing prices seem to have remained steady with only a couple of blips on the radar up and down. From all my Real estate counterparts the biggest issues are getting stock and then being able to get a sale exchanged and settled. Most Agents are reporting longer than normal settlement requests and wait times on exchanged contracts. There is still some good buying out there with motivated sellers needing their houses sold, so they can move on to their next home.

From the land of finance here, it is certainly true. Getting loans approved in the last while has been an arduous task, with the spotlight on living expenses, current debt either by way of credit cards and personal loans and a client’s ability to repay within a 30 year time frame. While most of this has been on the table as far as usual scenario’s go. The explanations required and accepted by various credit teams have certainly changed with more and more detail needed and requested.

In many ways I don’t believe that this is a bad thing. Knowing what your monthly, quarterly and annual expenditure is a good thing. Budgets are boring I know, but they certainly make it easier to track where you are, what you are doing and where you want to go.

The easiest way to eat an elephant is… in small bites! By looking at your overall debt and breaking it down into small achievable chunks is a way to not get overwhelmed. In the last several months I have discussed this more and more with many clients. If you look at your overall mortgage as one huge lump then the thought can be scary. If you however break it down into small pieces either by splitting a potion fixed and a portion variable. Or just taking the whole thing and working on $5,000 chunks at a time, putting it into a spreadsheet is a great way to trick your mind into watching it go away.

There are lots of helpful spreadsheets out there, though www.moneysmart.gov.au has some of the simplest I have found to track your expenditure. Many of the banks own apps can now enable you to see where your money goes. It is worthwhile mentioning here too the importance of keeping house with your banking. Most lenders now require 3-6 months’ worth of bank statements to not only go through your declared expenditure vs what shows on your bank statements. They are checking your conduct (whether you miss a payment or overdraw your account) as well as your spending habits. Making it another great reason you should be on top of your finances.

Over the last few months I have been building my armoury of lenders so I can help you better and make sure that you have the best lender for your needs. Whether it’s a home loan, investment, Commercial purchases, asset and equipment purchases, business finance or insurance premium funding. If you need help with anything at all I am sure I can find an answer.

I hope Winter treats you all well and that you and your families are safe, warm and happy.

I am always here if you have any questions

Justin