loans Archives - Berwick Mortgage Broker

May 23

The perfect property at an affordable price – it’s not a myth

So you’ve found your dream home, but it’s in need of a little TLC. While others may see this as a deterrent, this is actually a great opportunity to nab the house of your dreams at a price tag that’s within your means. Here’s how to tactfully negotiate the price without ruining your chances of securing the property.

Tip #1: Never enter a negotiation empty-handed

Whether it’s hiring inspectors for a building and pest report, or obtaining quotes from tradespeople, obtaining facts and figures will give you ammunition when requesting a price reduction.

“Even if it costs you extra, it’s worth getting all the information before making your offer. People often underestimate how much repairs will cost,” says the real estate agent.

Tip #2: Separate your emotions

The most tactful way to negotiate is to eliminate all emotions, advises the real estate agent. “Try to separate yourself from the outcome and present your side logically. The owner is under no obligation to accept what you offer, no matter how well you present your points. So if things don’t go your way, being negative won’t do you any favours.”

Tip #3: Remember this is someone else’s house

Negotiation is a two-way street, so in order to come to an agreement, concessions will have to be made on both sides. “Try to understand what is important to the owner,” advises the real estate agent. “What can you offer to counteract the price reduction you’re after? Perhaps a longer settlement period so they can find a new home? It’s little enticements like this that can often be much more valuable than a couple of extra dollars.”

Tip #4: If you don’t ask, the answer is always going to be no

“I’ve heard a lot of weird and wonderful requests when it comes to purchasing a house, so really you can ask for anything. Whether or not it will be accepted is another thing,” advises the real estate agent.

From wanting certain fixtures included in the sale price, to extra inspection requests, you won’t know what the owners are happy to give if you don’t voice your desires. However, before you go wild with requests, think about what is most important to you, as realistically the owners aren’t likely to budge on everything.

“In theory, you can inspect a property as many times as you like. In practice though, it will depend on your agent’s availability and whether or not the owner is currently living in the property,” says the real estate agent. “You might put off the owner if you are constantly disrupting their day, so as an alternative I’d suggest visiting the street at different times during the week. You don’t have to enter the actual home to get a vibe of what the neighbourhood is like.”

A house that requires a bit of repair work is a great bargaining tool and generally an opportunity to secure a good price. With the advice of industry professionals, such as Berwick Mortgage Broker, securing your dream home may be closer to a reality than you think.

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Saving Money by Alan Sarkissian

Apr 14

Five Simple Ways To Increase Loan Repayments And Own Your Home Faster

Paying off a mortgage can seem relentless – every payment counts of course, but it can seem to be taking forever to make a dent. Here are some simple ways you can increase the amount you pay off and own your home sooner.

Reducing the principle on your mortgage as quickly as you can means paying less interest, so your future payments are going even further towards reducing that principle.

To find the ideal balance between the extra repayments you can afford to make and the time this will shave off your mortgage term, use a mortgage calculator.

For example, on a $350,000 loan at six per cent interest, a monthly repayment of $2100 will see a total term of 30 years and a total cost of just over $750,000, while paying just $500 per month on top of that will bring the loan term down to just under 19 years and the total cost to just over $580,000.

Boosting these monthly payments by a further $400 to $3000 will see the loan paid off in less than 15 years – halving its term.

So, here are five simple ways to increase those mortgage repayments.

Ignore the bank

Well, sort of. Don’t pay any attention to the amount that you are told is the minimum repayment, as long as you pay more. Work out the most you can afford to pay, think of this as your minimum repayment, budget for it and stick to it.

Treat yourself

Think of every step you take towards reaching your goal of owning your property outright as a way of treating yourself. Sure, an expensive bottle of wine is nice, but doesn’t taking a year off your loan taste pretty sweet, too?

Every single increase to your income, no matter how small, should be channelled into the debts that are incurring the highest interest. If this is your mortgage, send it there. Do the same with your tax returns, any bonuses at work and even cash gifts.

Track your spending

Download an app to track what you are spending your money on, and trim where necessary, channelling the savings into your mortgage payments.

Think of all those little things you don’t really notice yourself pulling out your wallet for. In one week, that extra coffee on Monday morning, a sandwich from the cafe instead of one you have made yourself, that round of shots you probably shouldn’t have shouted on Friday night and getting your nails done on Saturday add up to $150. Over a month, that’s $600. Increasing a monthly repayment from $3000 to $3600 could trim more than 10 years off the term of a $500,000 loan. Now how much do you really want that coffee?

Eyes on the prize

Watch the forecast term on your mortgage – seeing it go down will motivate you to work even harder.

Talk to an expert

Talking to your finance broker about refinancing options could reveal a way to pay down your debt sooner even without increasing repayments. A finance broker will be able to look into whether you may get a better interest rate or lower fees with another lender, or even with your own, and will be able to help minimise any refinancing costs.

This is especially important each time your goals or your financial circumstances change. If you are earning more than when you took out your loan, you have paid off a personal loan or a credit card since that time, or your property’s value has risen, your finance broker may be able to negotiate a far better deal than the one you are on.

For example, if your finance broker negotiated your interest rate down from seven to six per cent on a $500,000 loan, on which you are making $3500 monthly repayments, your loan term could drop from just over 25 years to 21 years.

A Finance Broker is with you for life to make sure you’re always getting a good deal you can from your mortgage. Contact me to help you own your home outright sooner

Saving Money by Alan Sarkissian

Mar 26

What is the best time of year to buy a house?

While spring is renowned as the time that sellers dust off their properties and place them on the market, this doesn’t mean it is necessarily the best time for buyers to go shopping.

One of the biggest issues with shopping in spring is the flood of other buyers looking to snag their dream homes, which increases competition and housing prices.

“There is typically a seasonal uplift in buyer numbers over the last quarter of the year, which means the benefits of a higher number of options to choose from are offset by a higher number of prospective buyers,” explains CoreLogic RP Data’s Tim Lawless.

“Buyers may be better off when there are fewer buyers around in the winter months, at least from the perspective of being able to negotiate hard on price.”

Although there is a lot more to look at during spring, there isn’t necessarily more to choose from, depending on your individual circumstances and finances.

It may be just as beneficial for buyers to look around during slower months, as this will give them more time to consider properties, more time to negotiate and more time to organise their loans.

“Seasonal factors will always play a part in the dynamic of the housing market, but so too do other factors that are harder to anticipate such as changes in the regulatory framework that might make obtaining finance easier or harder, changes to economic circumstances or other things that can be absolutely unexpected,” Lawless says.

Taking all of this into consideration, the best times to buy are as varied as the people looking. It is a good idea to assess what’s most important to you before following the crowd.

“Buyers are probably best positioned to use the timing that works best for them and their budgets rather than waiting for a particular time of the season where conditions might be more or less favourable,” Lawless says.

Before you hit the open home circuit, speak or write to me about how to finance your property purchase.

slide by Alan Sarkissian

Dec 16

How to have a successful open for inspection

When you’re selling your house, the key to a successful open for inspection is to make potential buyers feel comfortable. You want to show your property’s best side, and allow people to see themselves living in their new home. We’ve put together some handy tips to help increase your property’s attractiveness on inspection day.

Put on a good face
Potential buyers will be inspecting your house from the moment it’s listed. They’ll drive by to check out the neighbourhood and see how things look from the outside – so this is the moment to make a good first impression.

Tidy the front garden, keep the verandah clear, hide the garbage bins and remove junk mail from your letterbox. You can add planters with colourful flowers to the verandah if you don’t already have them.

Remember to keep the external lights on at night, and make sure the front of the house – the face it presents to the world – is clean, freshly painted and well maintained: no sagging gutters, clogged downpipes or broken external blinds and shutters.

Clean until it hurts
Your house needs to sparkle and shine in every room (including the kitchen). Keep the sink clear of dirty dishes, put fresh (or even new) towels in the bathroom, make the beds and polish all tabletops, dressers and bureaus.

It can help to empty the dishwasher and keep the fridge clean and orderly – potential buyers might look in there, too.

Cut the clutter
Put away anything that isn’t essential to everyday living; take piles of magazines off the coffee table, clear away mail from the sideboard or wherever you keep it, and organise desks and tabletops.

Also remove knick-knacks and other personal items that might be on display, although don’t strip the place bare. It still needs to look like someone’s home.

Tone down the quirk
The purple beanbag? The kitsch op-shop vases? Your furniture says a lot about you, but too much personality can crowd out a potential buyer, so put the really ‘you’ items away during inspections. Buyers need room to project their own personalities onto your home.

Let the light in (and the smells out)
Swap dark, heavy window coverings for lighter blinds and curtains, and open them up to let natural light in. Also, consider repainting darker rooms in light, neutral colours.

Give your house a good airing before each open for inspection. Smells that you might not even notice, from cooking, pets or smoking, for instance, can be quite off-putting for others.

People can be sensitive to all types of smells, so while subtle floral or oil diffuser aromas are good, don’t overdo it with the ‘nice’ scents, either. The aromas of baking bread and freshly brewed coffee are attractive and homely – but are hard to organise if you’re not around.

Make yourself scarce
Buyers needs to feel like the home is almost theirs – having the current owners hanging around can make them feel like they’re intruding. It may also discourage people from telling the agent what they really think about the home – an important source of market intelligence.

Oh – and take the dog with you. Not everyone likes pets, some people are scared of dogs, and a roaming pooch will get in the way.

Presenting your property in the best possible light can improve your chances of a sale. With a bit of preparation, some elbow grease and attention to the finer details, your home will be ready to make its best impression on potential buyers.

Owning Property by Alan Sarkissian

Oct 3

What you can borrow or what you should borrow?

The amount you can borrow and the amount you should borrow are sometimes two very different things. Before you apply for a home loan, it makes sense to realistically assess your financial situation. Here’s how to do it.

Understand your borrowing capacity
Generally speaking, your borrowing capacity – what you can borrow – depends on a number of factors, including:

your income
your monthly expenses
your existing debts
how much deposit you have saved
current interest rate
type of loan
whether it’s a principal, or principal and interest loan
the term of the loan
estimated repayments.

However, knowing the difference between what you can borrow and what you should borrow is very important. As a general rule, it’s not a good idea to allocate more than 30% of your monthly household income to repaying your home loan.

Build a budget
To fully understand what your realistic borrowing limit might be, first of all create a budget – and stick to it. Once you understand exactly what’s coming in and going out you can properly assess how much you can afford to repay – and therefore what you should borrow.

If you don’t feel comfortable drawing up the budget yourself, it’s wise to seek help. A financial planner can assist you in preparing a budget.

Expenses to include in your budget include, but are not limited to:

council rates
body corporate fees (if applicable)
insurance costs
maintenance costs
utility bills
estimated groceries
medical bills and health fund payments
school fees
phone and internet costs
petrol and transport payments
entertainment, travel and clothing
other loans or credit card debts.

Future-proof your figures
Remember to leave a bit of wiggle room in your budget in case circumstances change. People can lose their jobs or get sick, or interest rates can rise, which could impact your ability to honour your repayments.

It’s also important to think about some other things that may happen: Is your income likely to increase within the next few years? Are you likely to have children and lose an income? Do you plan to retire shortly? These are all questions that only you can answer, and they will all have an impact on how much you should borrow.

Remember, lenders tell you how much you can borrow, but you know your personal circumstances better than anyone else – it’s up to you to decide how much you should borrow. If you need support and advice, a mortgage broker may be helpful during the decision-making process.

Home Loans, Saving Money by Alan Sarkissian