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Plan to repay the loan as quickly as possible; take advantage of redraw and offset facilities and make additional repayments where possible. Remember, you pay interest on every dollar owed, every day. The faster you reduce your loan the less exposed you are to the danger of a market dip. | Plan to repay the loan as quickly as possible; take advantage of redraw and offset facilities and make additional repayments where possible. Remember, you pay interest on every dollar owed, every day. The faster you reduce your loan the less exposed you are to the danger of a market dip. | ||
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Revision as of 02:40, 10 November 2009
Jennifer M. Schelbert
Mrs. Mortgage is a mortgage broker firm operating in Melbourne, with resources able to stretch around Australia.
Mrs. Mortgage is headed by the original 'Mrs. Mortgage' Jennifer M. Schelbert. Jennifer has been working in the mortgage broking industry for years, and deciding that the industry needed a highly ethical company that could cater to the personalized needs of the individual, decided to go out on her own.
Today Jennifer holds Diploma's in Financial Services (Finance/Mortgage Broking Management/Business & Commercial Lending), she is accredited with dozens of different lenders so that she can search for the best deal for you.
Mrs. Mortgage is a growing firm that has more than one 'Mrs. Mortgage' working for it. As the company continues to grow, it still holds true to its core values of high ethics, while working for the client in the best possible manner. This means that when you come to see us we will not just put you into the mortgage that will make the best lender fee for us, but the one that will suit you the best. This may even mean that we might send you back to your existing lender with no commission for us!
At Mrs. Mortgage we realise that very often people may wish to see us for advice on how to purchase their first home or investment property. If this is the case we will not push you into a contract until you are ready.
Our service to you is free, but other Government & Statutory fees may apply.
Please remember that the information on this site is for only for information purposes, and should not be relied upon as individual circumstances may be different.
You should contact a professional such as Mrs. Mortgage before committing yourself to any mortgage.
Consumer Guide To Comparison Rate Lending In Australia
Consumers have been able to determine the "true" cost of their mortgage loans since the Compulsory Comparison Rate Legislation (CCRL) came into force nationally July 1, 2004. Under the legislation any advertisement by credit providers and finance brokers containing an annual percentage rate must also show a comparison rate. The comparison rate must take into account all non-government credit fees and charges included in the loan.
The legislation is designed to give borrowers a better perspective when comparing different home loan products. Comparison rate legislation has evolved because of the rapid growth in the mortgage industry and increased competition between the lenders. The comparison rate gives borrowers a clearer picture of the actual costs when taking out a home loan.
Be aware that fees and charges are only included in the calculation if they are known when the comparison rate is disclosed. For this reason, early repayment charges and redraw costs are not considered in the calculation.
The CCRL, which forms part of the Uniform Consumer Credit Code (UCCC), will be in force for three years, after which the legislation will be reviewed to determine how the comparison rate is being used by consumers and credit providers.
What does it mean for consumers?
1. Any advertisement containing an annual percentage rate must contain the comparison rate. The comparison rate will be for six specific amounts.
2. Credit providers and finance brokers must display and make available copies of the comparison rate schedule at their offices.
3. Prospective buyers must be given a comparison rate schedule with any application form for credit.
4. The comparison rate given to prospective borrowers must include all known non-government credit fees and charges.
5. The prescribed warning - that comparison rate only applies to the example/s given and that, different amounts and terms will result in different rates. And that costs such as redraw fees etc are not included in the loan, but may affect the cost of the loan - must accompany the comparison rate and rate schedule.
Different Types of Mortgage Lenders in Australia
There are a lot of choices available when it comes to looking for a home loan, which is great for consumers because increased competition means more products, better service and competitive rates. Today about 42% of home loans are provided by brokers and non-bank lenders - gone are the days of putting on your best suit and visiting your bank manager.
Irrespective of the person or organization you choose to obtain a home loan for you, make sure they are a Member of the Mortgage Industry Association of Australia (MFAA). MFAA members and accredited mortgage consultants are bound by a strict industry code of practice that ensures the highest standards of business practice when representing you.
Banks these days are called the "traditional" lenders. They offer loans directly or through one of their accredited mortgage brokers. To obtain the loan, you are required to fulfill the bank's lending criteria. If you obtain the loan through a mortgage broker you do not pay any more (unless you are obtaining an extra service), and you don't pay a commission -the bank pays this to the broker for bringing your business.
Mortgage managers or non-bank lenders, this group operates in a similar way to the banks, offering their mortgage portfolio to you directly or through their accredited mortgage brokers. The funding for the loan comes from a variety of sources, and the owner of the mortgage is the provider of the funds. They manage the mortgage on behalf of the owner/trustee.
Non-conforming lenders
If you don't conform to banks' and/or mortgage managers' lending criteria due to the inability to substantiate your income source due to being self-employed, having an adverse credit history or poor payment record, then this group is for you. Their mortgages can be obtained directly, or through a broker, but their rates and fees are normally higher than conforming loans. If successful in gaining your business, the broker will also receive a commission from a non-conforming lender.
Mortgage brokers provide a variety of mortgage products, which they obtain for you through the panel of lenders they are accredited with. Essentially they are an agent of their panel of lenders, working with you to get you the most appropriate loan for your circumstances. They work closely with you to prepare the documents for the lender, submit the application, liaise with both parties through the process and answer any questions through to the approval stage of the loan. They offer their service free of charge as they are remunerated by a commission from the lender.
MFAA (Mortgage & Finance Association of Australia) member mortgage brokers will be transparent when it comes to providing you with full details about the loan, any upfront or ongoing fees, commissions, and who was on their panel of lenders. In NSW the broker is required by law to provide this information.
No Deposit Home Loans In Australia
Rising housing prices in recent years have made it very difficult for many homebuyers to save the deposit. Lenders have recognized this and have created the no deposit loan product.
No deposit loans are generally available for new and established buildings, owner occupied, as well as for investors. To qualify for a no - deposit loan you need to be an Australian Citizen or permanent resident and currently living in Australia.
Borrowers often need to acquire lender's mortgage insurance where the Loan to Value Ratio (LVR) exceeds 80%. Generally, the higher the LVR, the higher the premiums. Hence the premiums on a no deposit loan can be large.
Combining stamp duty exemptions and first homeowner grants, no deposit loans allow borrowers to gain a foothold in the market based on their ability to service the mortgage rather than having the savings required to qualify for a more mainstream loan with deposit.
No deposit loans can also be a useful tool for investors wanting to take maximum advantage of leveraging.
While no deposit loans can be secured for similar rates to standard home loans, you should be aware that there is the risk of ending up in negative equity. For example, you purchase a house for $300,000 borrowing the full amount and the property market falls by 10%, you now owe $300,000 for a property that is worth $270,000 - that's a shortfall of $30,000 you need to recover.
As with all loans, make sure that you borrow within your means. Work out a budget, stick to it, and do not borrow more than you planned just because it is available. Also, consider the property market that you are buying into: are the prices rising or falling?
Plan to repay the loan as quickly as possible; take advantage of redraw and offset facilities and make additional repayments where possible. Remember, you pay interest on every dollar owed, every day. The faster you reduce your loan the less exposed you are to the danger of a market dip.
Why Use A Mortgage Broker/ Why Mrs. Mortgage
Why do property buyers use a mortgage broker to find their finance?
Being a 'mortgage' broker is a lot like being a 'marriage' broker.
There’s this bride looking for a husband. She wants a husband for life; not just for the next few months.
To avoid making a mistake she consults a reputable marriage broker.
The broker knows all of the available suitors. He’s dealt with them before.
This one might have plenty of gold and jewels but he’s also pushing ninety.
This one is tall, dark and handsome but he’s as poor as a church mouse.
This one is both rich and handsome but he has a history of leaving broken hearts wherever he goes.
The marriage broker’s job isn’t to recommend the first man to come along.
It certainly isn’t to recommend the one that is paying the largest amount of money and it isn’t to recommend someone that is destined to be a disaster.
The happy ending to the story is obviously an ending where everyone is happy.
Finding the right home loan can be a very similar story.
Firstly, a good mortgage broker knows who to call and generally knows which banks or which lending institutions are likely to suit the property buyer’s situation.
(There are many different banks and lenders offering over seven hundred different home loans).
The broker (after doing their homework) then recommends two or three banks (or lenders) to the property buyer and explains the features and benefits that are available with these loans.
One lender may offer a redraw facility, another may let you pay off the loan quicker without any penalties, another might be willing to talk to self-employed people.
Every lender offers different benefits and facilities.
In the past if you got all the benefits then you usually paid a higher interest rate but these days the banks and lenders are very competitive.
There are some amazing products out there but no two are alike.
My job is to find the right home loan that meets all of my client’s needs and wants.
It’s just a matter of knowing where to shop.
The mortgage broker then helps to set up the loan. This might be quite straightforward or it might be complex.
It might take a couple of days or it may go on for weeks.
The first thing I do is find out EVERYTHING that I need to know about my client (and their financial situation).
I expect them to be completely honest with me and I’m completely honest with them. (My business is to organise & obtain finance... it’s not PR).
I work for my client. I don’t work for the banks or lenders.
Sure the bank writes me a cheque when the deal is done but my clients’ interests take precedence over everything else.
Nothing that I do is hidden or below the table.
My clients always know who is paying me and how much.
So my advice is: Choose your mortgage broker wisely then listen to their advice.
- Jennifer M. Schelbert Dip. Fin. Serv./ FinMBM/LEND is a director of Mrs. Mortgage Pty Ltd, a licensee for Choice Aggregation Services, a member of COSL and a full member of the Mortgage Finance Association of Australia.
Phone 1300 735 161
External Links
Business URL: http://www.mrsmortgage.com.au, http://www.mortgage-blog.com.au
Name: Jennifer M. Schelbert
Country: AustraliaPhone: 1300 735 161
Web: http://www.mrsmortgage.com.au/
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