Your Finance Questions Answered

posted on : June 18, 2021

What you need to know if you are looking to apply for finance…

As a result of the booming property market, banks are experiencing a huge increase in the volume of applications. The consequence of this is large delays in their ability to assess loan applications. 

Some major banks are taking up to 45 working days to start the assessment on a new loan application and many others are between 20 and 30 working days. 

There are still lenders able to provide assessment and approval within a week, but it has never been more important to select the right lender than in this current market. 

What does the federal budget mean for downsizers?

For older Australians that own a home and are thinking about downsizing, now is the time to consider it. In a bid to free up stock of larger homes for younger families, the government is enticing older Australians with superannuation incentives.

From July 1 if you are aged over 60 and sell your home, you will be able to make a one-off, post-tax contribution of up to $300,000 per person (or $600,000 per couple) to your super regardless of how much you already have in your super. Previously this was only available to those over 65.

Planning to buy your first home – here is what you need to know!

The new First home super saver scheme in the 2021 federal budget proposed superannuation incentives for first home buyers.

Those saving for their first home deposit can put away up to $20,000 in extra voluntary super contributions. This is on top of the $30,000 already permitted from pervious budgets. Meaning, first home buyers can withdraw up to $50,000 in voluntary super contributions to put towards purchasing their first home.

Bank account options linked to home loans – what is the difference?

Many are unsure of the best way to structure their mortgages and some consider an offset account where, like an everyday transaction account, you use it to put your wages, pay your bills, do grocery shopping etc is linked to your mortgage. This means that when it comes to calculate your mortgage repayment it includes any money saved so you are charged less for your repayment for example, Your home loan is $500,000 and you have $50,000 in your offset account – you will only be charged on $450,000. This can be a fantastic way to minimise the length of your loan.

Another option is a redraw facility. This s a feature attached to your loan which allows you to make extra repayments into this facility however you can redraw on these funds. Again, a fantastic way to take years off the length of your loan and make less tempting to touch your saved funds.

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