Page 1

Expert tips to make you loan-savvy! Love your home. Love your loan. | www.timehomeloans.com


Contents: Introduction: A winning formula for Home Loans, Refinance, Investment Lending, Car Finance and Financial Planning Chapter 1:

Don’t be afraid to compare!

Chapter 2:

Ask the right questions

Chapter 3:

Know your loans and their differences

Chapter 4:

Understanding Insurance

Chapter 5:

Freedom to choose - Why Time Home Loans?

Chapter 6:

Our easy process - Steps to be ready

Chapter 7:

Time tips for satisfaction

Chapter 8:

How else can we help?

Chapter 9:

Conclusion

Love your home. Love your loan. | www.timehomeloans.com


INTRODUCTION

A winning formula for Home Loans, Refinancing, Investment Lending, Car Finance and Financial Planning.

No matter what they say, coming first is still better. In fact, winning is as important in sport as it is in all aspects of life! Most importantly, when it comes to major financial decisions, whether purchasing a new home (perhaps your first), refinancing, investment lending, purchasing a new car or simply needing some financial planning, it’s important to gain the best knowledge, insights and strategies to make winning a reality. With so much to consider, the process doesn’t have to be as daunting as it seems. In this Time Home Loans e-book we will guide you through the most important considerations including:

What? Compare apples with apples Why?

The art of asking the right questions

How?

An in depth understanding of how different loans & insurances work

When?

Our steps to be ready

Love your home. Love your loan. | www.timehomeloans.com


CHAPTER 1

Don’t be afraid to compare!

When purchasing a new home or car it’s common to first search to find one that suits the many requirements you both need and like. Why then would you not take the time to compare the many loans on offer? After all, this will be without a doubt the biggest financial decision you’ll ever make. Here’s some good reasons to compare: 1. Using the big banks does not always mean the best deal or cheapest rate. For instance, some lenders market their home loans based on a discount off their standard variable rate. However, the deal you receive could be much more than 2. many other home loans in the market.

2. Comparing lenders gives you access not only to the best rates and deals but also gives you a better understanding of the various fees and charges, features, support capabilities and future commitments each lender offers.

Be loan-savvy and take time to compare what’s on offer! Going through a mortgage broker could be more beneficial than going straight to one of the big four.

Love your home. Love your loan. | www.timehomeloans.com


CHAPTER 2

Ask the right questions.

To start a winning formula you need to ask yourself some key questions before choosing a loan. These questions will quickly define your goals and narrow down the product you choose. Key questions to ask: • What’s the purpose of the loan? • What’s my personal financial circumstance and how much can I afford? • What deposit will I need? • Where do I find the best rate? • Will I be able to maintain a higher rate change? • What fees will I have to pay upfront? • Should I fix, go variable or split my loan and what’s the difference? • Are there any hidden costs? • Do I need insurances and which ones are better suited to my circumstances? • Are there any additional benefits or features? These considerations should lead us to our ideal loan, however there are many other points to bear in mind when looking at individual products. In the next chapter we explore the different loan options.

Be loan-savvy and ask the right questions!

Love your home. Love your loan. | www.timehomeloans.com


CHAPTER 2

PLAY VIDEO

PLAY VIDEO

Love your home. Love your loan. | www.timehomeloans.com


CHAPTER 3

Know your loans and their differences.

Basically, there are six common types of home loans available including Introductory, Variable, Discount Variable, Fixed-Rate, Low Doc Loans and Split Loans. Deciding on which one is right for you means you will have to factor in all the features available. Introductory Loan Aimed at first home buyers and also known as honeymoon loans due to the ‘honeymoon period’ during which you pay a discounted interest rate, these loans usually offer an eye catching and irresistibly cheap rate for an initial period of time. However, this low rate usually lasts for only 12 months, though some lenders offer the discount between 6 months and 3 years. The introductory rate can come in two forms, the first being a ‘fixed discount’ and the second being a ‘discounted fixed’ rate. The fixed discount is a rate that will be variable, but fixed at a certain level or margin below the standard variable rate. This means that for the introductory period, the discounted rate will move with the market. If the standard variable rate rises by, say 0.50%, so will the discounted rate, and if the standard variable rate drops by 0.50% the discounted rate will also drop. The discounted fixed rate, on the other hand, is a rate fixed for the introductory period of the loan, and won’t move with the market. Honeymoon loans are generally only offered to new borrowers. While these loans are popular, there are a number of things to take into consideration. Most of these loans will revert to the standard variable rate after the introductory period to what is generally the most expensive rate in the lender’s variable suite. Some lenders may also ‘cap’ or limit the amount of extra money you can pay off the loan during the introductory period, which, in turn, may limit the benefit of having the introductory period.

Love your home. Love your loan. | www.timehomeloans.com


Know your loans and their differences contd: Variable rate home loans A variable rate home loan is a competitive product amongst lenders and is suited to those who are flexible. Rates for variable loans can sometimes be lower than fixed rates, as the loans go with the flow of the market. If your loan was taken out after July 1 2011 there will not be any exit fees with a variable loan. One of the downsides of a variable rate is your monthly repayments will usually change as the market does.

Discounted Variable rate home loans The discounted variable rate offers a discount on a certain interest rate – most commonly a lender’s Standard Variable Rate. The discount can be for an introductory term of 2, 3 or 5 years, or it could even be for the entire term of the mortgage (a lifetime discounted rate). Of course, discounted variable home loans are a type of variable interest rate so your payments can go up and down as the interest rate goes up and down. Although they may sound like a good deal, they are not necessarily the cheapest mortgage rates you can get – you may be able to find a cheaper mortgage. Likewise, because the rate is variable you won’t get the same payment security as you get with a fixed rate.

Fixed rate home loans With interest rates as low as they are, fixed rate home loans have grown in popularity. Fixed loans allow you to lock in a fixed rate for a set period, usually between three to five years. In short, it takes the worry out of possible increased rates and allows you to budget accordingly. Fixing your home loan needs to not only suit you now but into the future also, as fees for breaking your fixed rate home loan can be many thousands of dollars. A fixed rate could be good for first home buyers, as it gives reliability and allows you to budget each month as repayments remain the same. However, some lenders may charge you to make extra repayments.

Love your home. Love your loan. | www.timehomeloans.com


Know your loans and their differences contd: contd. Low Doc Loan Another common loan is the low document or ‘low doc’ loan. The major differences between mainstream and low doc lenders are that low doc lenders do not require traditional proof of income such as company financials or tax returns. Instead, borrowers generally complete a declaration that confirms they can afford the loan. This is known as self-certification. As such, these loans are particularly attractive to self-employed or full-time investors who may have difficulty showing a high level of income. In essence, they are a flexible option for self-employed people who have income and assets, but are unable to provide the required financial statements or tax returns. Be aware though that interest rates and fees are normally higher with low doc home loans. Along with this, Lenders Mortgage Insurance (LMI) fees often apply and are usually capped at 80% of the valuation of the property. Split loans Split loans allow you to have the best of both worlds – you can fix one part of your loan and let the other fluctuate with the market. Split loans allow you to have both interest rate security but also repayment flexibility. Split loans offer certainty around your long term budget but allow you to still access variable loan features, such as redraws and extra payments. It’s important to look at all the features of a loan and understand the loan term. Shorter loan terms usually mean you pay less interest and pay the debt faster, meaning more money in your pocket in the long run. Loans can be repaid weekly, fortnightly or monthly. You will most likely choose your repayment frequency based on your financial situation but keep in mind, the more frequently you make repayments (e.g. fortnightly versus monthly) the slower the interest grows and the faster you pay off the mortgage. With an ‘all-frills’ loan, the borrower is likely to be paying a higher interest rate. If they don’t use all the facilities offered on the loan, it makes sense to refinance and switch to a more basic product offering at a lower interest rate. Repayments will be lower, and it is more affordable to pay off the property faster.

Love your home. Love your loan. | www.timehomeloans.com


CHAPTER 4

Understanding Insurances.

There are three different types of insurance to consider when obtaining a home loan, including Lender’s Mortgage Insurance (LMI), Mortgage Protection Insurance and Home and Contents Insurance. 1. Lenders Mortgage Insurance (LMI), a once-off premium paid for by the home buyer, covers the lender for any shortfall between the value of the mortgage owed and value of the house in the event that the home buyer defaults and the lender is forced to sell the house. LMI is generally around 1% to 4% of the total loan and is applicable to those who borrow over 80% of the property value. Paying LMI allows borrowers with smaller deposits to buy earlier, rather than wait until they have saved up a 20% deposit. It can be paid upfront or added on to the total loan amount. Different lenders charge different LMI’s, therefore in order to get the best deal, it’s best to go through a mortgage broker who can compare what’s available. 2. Mortgage Protection Insurance (MPI), covers borrowers for the payment of their mortgage instalments in the event of unforeseen circumstances such as unemployment, critical illness or death. MPI can be discussed and arranged through your broker. LMI actually does the opposite – it protects the lender. 3. Home and Contents Insurance, which you can purchase as a bundle or buy separately. In general, this insurance will cover you in case of fire, theft or attempted theft, lightning, malicious damage or vandalism and storm and rainwater damage.

Love your home. Love your loan. | www.timehomeloans.com


WE BRING MORE THAN 25 LENDERS TO YOUR DOORSTEP - THAT’S CHOICE!

Open the door to a life changing conversation.. “Ever compared your loan with other lenders? You may find you’re missing out. Time Home Loans not only offers you the all-important freedom to choose, we also outshine the banks in service, personal touch and passion!” Here’s why it’s wise to use a Time Home Loans Mortgage Specialist!

We work for you, not the banks.

We will source the right loan for you depending on your financial circumstances.

The banks would offer a suitable available product, however they won’t tell you if another bank has an even better product or deal for you.

The Mortgage Specialists you can bank on. www.timehomeloans.com

Love your home. Love your loan.

Copyright 2013 Time Home Loans. Australian Credit Licence: 433589. Please contact our financial brokers for more information. Your contact information will be collected by us. Time Home Loans can be contacted at info@timehl.net.au. We use this information to stay in contact and provide our services to you. We may also use your information to offer or provide you with additional products or services, or ask for your feedback. We may not be able to assist you if we do not have your current contact information. We may need to disclose your information to our associates, contractors and service providers, who may be overseas. Our Privacy Policy contains information about how you can access your personal information and request corrections or complain if you are dissatisfied with how we have dealt with your personal information.

Love your home. Love your loan. | www.timehomeloans.com


Building your new home? Try our easy 4 step process. Organising your finances and applying for a construction loan is not only time consuming but also complicated. Let us simplify your life by making the loan application process the easiest major decision you have made. DOING IT YOURSELF

USING A TIME HOME LOANS BROKER

Make an appointment to see a Time Home Loans Broker.

1. Make appointment with Bank Manager 2. Collect all required paperwork 3. Complete loan application 4. Follow up pre-approvals 5. Provide copy of pre-approval to sales consultant 6. Follow up fixed preliminary quote

Complete an application with a Time Home Loans Broker. Sign letter of offer and mortgage documents.

7. Send preliminary quote & house plans to bank 8. Follow up receipt of preliminary quote with bank 9. Follow up receipt of building contract with bank 10. Follow up building contracts, plans & specifications 11. Send building contract to bank 12. Wait to receive unconditional approval 13. Follow up letter of offer & mortgage documents

14. Send copy of letter of offer to builder 15. Organise signing of letter of offer & mortgage documents 16. Return letter of offer & mortgage documents to the bank 17. Follow up bank to confirm receipt of letter of offer & mortgage documents 18. Organise copy of council approved plans, Builders All Risk Insurance, HOW Certificate & Building Permit from builder

All done! Construction commences.

19. Send copy of council approved plans, Builders All Risk Insurance, HOW Certificate & Building permit to bank 20. Follow up receipt of council approved plans, Builders All Risk Insurance, HOW Certificate & Building Permit by bank 21. Confirm settlement with bank/builder 22. Phew!! Commence construction

Love your home. Love your loan. | www.timehomeloans.com One call... many options! Start a life changing conversation...

t: 07 3194 0888 e: info@timehl.net.au

Copyright 2013 Time Home Loans. Australian Credit Licence: 433589. Please contact our financial brokers for more information. Your contact information will be collected by us. We use this information to stay in contact and provide our services to you. We may also use your information to offer or provide you with additional products or services, or ask for your feedback. We may not be able to assist you if we do not have your current contact information. We may need to disclose your information to our associates, contractors and service providers, who may be overseas. Our Privacy Policy contains information about how you can access your personal information and request corrections or complain if you are dissatisfied with how we have dealt with your personal information. Time Home Loans can be contacted on info@timehl.net.au.

Love your home. Love your loan. | www.timehomeloans.com


CHAPTER 5

Freedom to choose.

Why use a Mortgage Specialist?

Why use Time Home Loans?

More and more people are seeking the services of mortgage planners. No surprises. Here’s why:

5 minutes is all it takes to see how Time Home Loans could save thousands on your next financial choice! Time Home Loans can help. Here’s why:

Mortgage planners will source the right loan for you depending on your financial circumstances.

The banks would offer their best available product, however, they won’t tell you if another bank has an even better product or deal for you.

The role of a mortgage planner is to research the best loan for you against other products available on the market and recommend this to you based on your individual financial situation.

We work for you, not the banks. Our Brokers are available 7 days a week.

Through Time Home Loans you have access to many exclusive offers. With access to more than 25 lenders and over 800 products we give you the freedom to choose. Special benefits for Accountants, Solicitors and Doctors*. Time is money - and we would like to save you some!

Conditions may apply as per lending institution’s policy

*

Love your home. Love your loan. | www.timehomeloans.com


CHAPTER 6

Our easy process - Steps to be buyer ready.

The big question is - are you ready to buy or bid? At Time Home Loans we know your time is valuable. Arranging finance, sourcing the best rates on offer and understanding the process is a time-consuming and complicated job. That is why we created our unique 4-step hassle-free process so you can spend more time relaxing and less time worrying. Consider this, when you make a decision to bid at an auction, is your bank an auction expert? Equally, if you decide to build or renovate, is your bank a construction and renovation expert? At Time Home Loans we make your loan go further with the best experts in the business. Our easy steps to getting ready start with a simple email or phone call.

1

Make an appointment to see a Time Home Loans broker.

Whether buying, building, renovating or refinancing it is important to review and factor in your current finances; your borrowing needs as well as your future needs. Doing this will help you identify how much you can borrow, and more importantly, whether you can afford the loan. It’s equally important to consider the total costs of a home loan – not just the purchase price.

2

Complete an application with a Time Home Loans broker.

It’s time for action! Once you’ve selected the loan that best suits your situation and requirements, it is time to complete the loan application. Don’t worry, this is where your broker will guide and help you complete, sign and date the loan application. Professional advice on what’s needed to support will also be provided.

Love your home. Love your loan. | www.timehomeloans.com


Our easy process - Steps to be ready contd.

3

Sign the letter of offer and mortgage documents.

4

All done! Love your home. Love your loan.

Once the application is approved we issue the home loan contract to you for signing.

It’s settlement time. Time to love your home and love your loan.

We recommend that you check all your home loan documentation thoroughly before signing, dating and returning to us.

Once all the requirements are met, the loan funds become available to you. You or your solicitor will need to make arrangements for settlement. This includes advising Time Home Loans of banking details, as well as stipulating any amounts that need to be paid to which beneficiaries at least three days before settlement of purchase. In the case of a home purchase, the real estate agent will be instructed by the seller to give you the keys.

Love your home. Love your loan. | www.timehomeloans.com


CHAPTER 7

Time tips for satisfaction.

Tip 1: Pay off your mortgage as quickly as possible. The best way you can save money on your mortgage is to pay off your loan quicker. Here’s how it works. The longer you take to pay off your principal loan, the more interest it accrues along the way. Please be aware that there will be additional fees or charges when making additional payments if you have a fixed loan. Payments can be easily made at a branch or via internet banking.

Our free Home Loan Health Check is a good ‘Loan Smart’ idea!

Tip 2: The way you make payments is important. How you make payments can make a huge impact on the overall term and cost of your loan. • If your loan is flexible and allows increased regular repayments and lump sum repayments without incurring additional fees or charges, take advantage whenever you can. • Try and make more frequent repayments such as weekly or fortnightly. In both cases you will end up making 13 monthly repayments as opposed to twelve monthly repayments. This will save you money by reducing the principal and term of your loan.

One quick click and a few simple details is all you need to find out how healthy your loan is and more importantly how to make it a healthy loan!

Love your home. Love your loan. | www.timehomeloans.com


Time tips for satisfaction contd.

Tip 3: Protect yourself against rising rates. Predicting the interest rate changes are almost impossible. By splitting your loan into two loans – one variable and one fixed – you can prepare for and protect yourself against rate rise.

Tip 5: Deposit your income directly into your home loan while managing your day-to-day expenses on an interest free period credit card. If you are able to carefully manage your expenses, this may be one of the best ways to use your existing financial resources to reduce the cost of your loan.

Tip 4: Deposit your spare cash into your loan. •

No matter when you have it, extra cash repayments reduce the time and interest of your loan. It is better to make these extra repayments early rather than later- due to the effect of compounding interest over time.

Tip 6: If your home loan repayments drop due to interest rate cuts, don’t lower your repayment. It is always a temptation to pay less on your mortgage. By maintaining your current repayment, you’ll pay off your loan a lot quicker.

• Redraw facility features can give you the added flexibility of being able to access the equity in extra repayments when you need it.

Love your home. Love your loan. | www.timehomeloans.com


CHAPTER 8

How else can we help?

Our other services: Financial Planning At Time Home Loans we will work with you to identify the level of advice and services for you to meet your financial goals.

Commercial Lending For businesses of all sizes, Time Home Loans offers commercial loans with flexible repayment terms and competitive fixed or variable interest rates.

Equipment Finance We have secured and forged strong relationships to assist our clients needs.

Debt Management By refinancing and rolling high-interest debt into your mortgage you can improve cash flow, focus on one payment and enjoy huge interest savings.

Depreciation Services Time Home Loans has negotiated a market leading price to assist our investment clients with a free depreciation schedule when you do your home loan application through Time Home Loans.

Home Connections & Disconnections Your move has just got easier. Powered by one of Australia’s leading utilities connection providers we can arrange swift connections or disconnections for your electricity, gas, water, phone & internet, cleaning services, insurances, removalists & truck hire.

Home and Content Insurance At Time Home Loans we have negotiated a period of 1 free cover if you take a policy on your loan.

Investment Loans Buying an investment property is as big a decision as buying a home. At Time Home Loans we work closely with you to ensure your investment portfolio grows in a sustainable manner. Free cover applies only to new policies signed through Allianz.

1

Love your home. Love your loan. | www.timehomeloans.com


CHAPTER 9

Conclusion.

For Time Home Loans, it’s not just about the loan, it’s more about the experience! Getting a home loan is a complicated task. With multiple number of available loan options, different lenders, products, services, fees, insurances it takes loan-savvy to cut through and make the right choice according to your personal requirements. Here at Time Home Loans we want the experience of purchasing your new home, investment home or refinancing option to be what it should be - a stress free, exciting and special adventure. We hope the information herein will be part of the process in enabling you to do just that. Carefully go through each chapter and get a good understanding of our ‘what, why, how and when’ found on the introductory page. Once you have ascertained all of the above you should be in a far better position to make the right choices. Please don’t hesitate to call or contact us so we can help implement this plan in a professional, cost effective and stress free manner.

Love your home. Love your loan. | www.timehomeloans.com

Get loan smart  

Expert tips to make you loan-savvy!

Read more
Read more
Similar to
Popular now
Just for you