John Rachcoff - Liberty Network Services

02/11/2017

https://www.liberty.com.au/barometer/home-finance-property/what-s-happening-in-property-this-spring

If you’re in the market for property this spring, here are some of the trends you might notice and some tips to get you ready.

28/09/2017

If you’re self-employed or have had difficulty getting a loan, Liberty’s approach to lending may be of help. Call John Rachcoff on 0439 653 635.

28/09/2017

When you apply for finance your lender will look at a number of different factors to determine your borrowing power – here is an explanation of some of them.

28/09/2017

John Rachcoff has over 17 years experience in the Finance Industry and as a Liberty Adviser John is able to assist a broad range of customers achieve their financial goals.

Give John a call today to discuss your Finance needs on 0439653635 or email [email protected]

07/09/2017

https://www.liberty.com.au/barometer/home-finance-property/the-ato-s-new-power-could-affect-your-ability-to-get-a-loan

Government proposal may give the ATO new powers to report outstanding tax debt to credit reporting agencies. Here’s what it might mean for anyone looking to take out a loan in the future.

03/11/2016

Combat the summer property rush and secure the home of your dreams.

12/07/2016

The end of the financial year is the best time to take stock and finally get on top of your finances.

07 July 2016

It’s finally here – the new financial year. No doubt the last one probably flew past too quickly, and half the things you wanted to achieve just didn’t eventuate. Too often this is the case for many Australians, especially when it comes to sorting out finances. So, to ensure this new financial year is the year you truly do get on top of bills, savings and debt, here are six tips that will get you greater financial control.

Teach yourself to love your budget. The hardest thing about setting a budget is sticking to it for the rest of the year. It takes discipline and commitment – but once the real benefits of having a budget start to materialise – many people start to love being budget conscious. If you tell yourself you’re a budget person, and start to believe it, managing money becomes so much easier.

Prioritise bills. When a bill arrives in the mail, don’t throw it in a drawer, or stick it on the fridge and do nothing about it. Bills don’t go away; in fact if they are ignored for too long they can cause bigger issues. Plus there are often extra charges for missed bill payments – and this hits the back pocket even harder. So, don’t stare endlessly at bills wondering how you’re going to pay them off. Create a spreadsheet that tracks each monthly bill and put money aside to cover the costs so they can be paid the second they land in the mail.

Stop putting everything on plastic. In fact, try using cash instead. The theory goes that withdrawing weekly spending money from an ATM to use when shopping, eating out or socialising with friends will help you stick to a weekly budget. And it works. If you’re really feeling up for it – try leaving your plastic cards at home altogether. That way when the money runs out, it actually runs out.

Find a free financial planning tool. There are a range of free financial tools available online and they can really help. Whether it’s a template in Excel, or a smartphone app – find one that best suits you. Financial planners map out income, expenses, savings goals and disposable income and then help you to spend less than you earn – something many people struggle with.

Make the most of auto payments and direct debits. Technology can really help keep on top of bills and savings. Talk to your utility providers about setting up direct debits so a bill is never missed. Then create a savings account and have regular payments deposited into it. Even if it’s $25 dollars a week – it will all add up over time.



Find a finance buddy. It’s easier to do things when there’s someone else doing it as well. So, find a buddy to bring along on the journey. Meet with them once a month to talk about how you’re going and share tips. Maybe even get a little competitive - if that’s what it takes to help you get in better financial shape.


https://www.liberty.com.au/personal-loans/six-finance-tips-to-kick-start-your-new-financial-year

The end of the financial year is the best time to take stock and finally get on top of your finances

09/05/2016

Before sub-dividing a property, land owners should consider the costs, any council restrictions and - most importantly - how they fund the project.

Over the last 50 years the great Australian dream of owning a house with a big backyard has abated somewhat to the convenience of living close to the city. We’re now paying more money for less land – but faster commute times. According to the Urban Development Institute of Australia the average size of land for sale across every capital city dropped below 500 square metres for the first time in 2015 – and historical data tells us this number will keep getting smaller.

In an active property market, any home owner sitting on a large piece of land is presented with the tantalising thought of possibly sub-dividing. This is particularly the case where there is enough equity in the property to finance the subdivision and build a new dwelling. Obviously the hope is to make a profit at the end of the process to help pay down any remaining loan. However sub-dividing is no walk in the park. There are lots of things to consider before making the big step – here are a few tips to start with.

Make sure it will be profitable

When thinking about sub-dividing, it’s critical to establish the likelihood of being able to make a profit from the exercise. Talk to a few real estate agents about the value of the land as a whole, then as two separate lots. Know how much building any new dwellings will cost and also think about possible taxes if one or both of the properties are sold. Remember the property market could shift during the build, so it’s best to be conservative and factor any potential market downturn into the calculations as well. In short, get great advice.

Make sure the property is big enough

The size of the land affects how many subdivisions can be made and the size of the houses that can be built. The minimum land size per property, and maximum dwelling size that can be built, varies from council to council. As an example, in parts of inner city Melbourne, it’s a minimum 300 square metres and only 50 per cent of the land can be covered. Off-street parking or a private open space like a balcony or yard might be required and there will be restrictions on the minimum front, back and side setbacks from the boundary. Having a bigger lot simply gives more flexibility when it comes to the type and size of the dwelling. Owners of smaller lots will have to be more creative. One tip is to see what neighbours and other properties in the local area have done, which should give a good indication about what is achievable.

Build one or two dwellings?

Savvy sub-dividers will work out if it’s possible to keep the existing house and build in the back yard, or if they have to demolish and build two new houses. Keeping the existing house will stretch a budget further, however does result in having an older property at the end of the process that may not be worth as much as a new place. For those who want to build two dwellings on a smaller lot, often a duplex – double storey houses side by side – is a more efficient way of getting larger homes, both with street frontage, onto the lot. Although, remember some councils won’t allow certain types of buildings in their area, so again, it’s a good idea to check or look around the neighbourhood to see what has already been done.

Financing the loan

If there is an existing mortgage on the property, find out your lender’s requirements, but it’s best to seek pre-approval for new plans. Remember, you need to cover any planning permit, demolition, advice and build costs, and if you’re borrowing some or all of the money required, the loan needs to be manageable once the project is complete. If the existing house is being demolished, temporary accommodation and storage costs will come into play as well. Have an agreed date for the construction to be completed in the building contract and consider negotiating that compensation is paid for additional living expenses, or lost rental income, if the property isn’t completed on schedule.

Sell the property? Or rent it out?

Once complete, deciding what to do with the houses is the next big decision. Keep in mind things like capital gains tax and real estate fees if selling one or both properties. If renting one property out and living in the other makes more sense – do research about the possible rental yield. Houses in a popular area may draw high rental yields and effectively cover all the repayments on the remaining home loan.

11/04/2016

If you can't afford to buy in the area where you rent - become a rentvestor and get the best of both worlds.

Heat in property markets across many of Australia’s capital cities has left the latest generation of first home buyers struggling to save the deposit needed to enter the market. As a result, first home buyers, many with busy office jobs in the CBD, are now faced with the prospect of buying a more affordable home out in the suburbs. Lengthy daily commutes and life away from exciting city living however may make the dream of home ownership less appealing.

That is unless they chose to rentvest. The concept is simple: Buy an investment property where you can afford but remain renting in the area you want to live. Here are some of the reasons why rentvesting is gaining popularity particularly with generation Y:
Lower deposit: Because the house is further away from the city, chances are you can buy it for less. This means the size of the deposit needed is lower and won’t take as long to save.

Rental income: Putting tenants in the property means it will start to generate a rental income that you can put towards mortgage payments. Depending on the size of the property and the rental return, it may bring in the same amount of rental income as what you pay for your smaller inner-city rental. Or, if it is less, then you may only have to top it up a bit each week and may potentially claim this shortfall as a tax deduction.

Negative gearing: Unlike loans for owner occupied property purchases, where the mortgage is not tax deductible, loans for property investment purposes are generally tax deductible. Of course, for most rentvestors, the ultimate goal is to also see the value of the property increase over time and debt levels reduce.
Lifestyle: Renting close to the city, the beach, or your family means that younger generations can continue to live the lifestyle of their choosing. Commute times are smaller with easy access to bars, cafes and social activities.

The old saying goes that each generation should successively end up wealthier than the last. So gen X should be better off than the baby boomers, and gen Y should be better off than gen X. Unfortunately, it seems this pattern is about to be broken and one reason is because it’s becoming increasingly difficult for gen Y’s to get on the property ladder. As a solution, more first home buyers are turning to rentvesting to finally make the leap into property ownership.

If you’re considering the rentvesting path, make sure you listen to the podcast below. In this episode of Liberty’s Small Business and Property Barometer, Effie Zahos the editor of Money Magazine, gives tips on areas in our capital cities that rentvestors should be watching closely.

06/04/2016

It's the question everyone wants the answer to - should I fix my interest rate?
With interest rates at an all-time low, Steve Price chats with Heidi Armstrong about whether now is the time to fix your interest rate.




https://www.liberty.com.au/barometer/podcasts/to-fix-or-not-to-fix

Liberty isn’t a ‘me too’ lender, that’s what makes it so unique

17/03/2016

Despite the cash rate going unchanged again this month the RBA could end the wait at any time.

08 Mar

The cash rate went unchanged again this month – so it remains at 2 per cent and has remained so for some time. Despite this holding pattern, it’s likely the Reserve Bank will have to make a move at some point this year. What we’ve seen in recent weeks are the deciding factors for this move becoming much clearer.
According to new figures from the Australian Bureau of Statistics (ABS) released last week wage growth has fallen to a record low of just 2.2 per cent a year. This is the lowest annual wage growth since the series started in 1998 and is expected to remain restrained because inflation is low and weak commodity prices are affecting our export industries resulting in downward pressure on wages.
At the same time we’ve seen a continued lack of investment in key industries like mining. While this challenge has been on the radar for some time – investment was predicted to fall by close to 10 per cent during the 15/16 financial year – no imminent solution is in sight. While housing construction is strong, especially in NSW, at the same time ABS figures show approvals for new housing developments experienced a drop of 7.5 per cent during January 2016 and this was driven mostly by a 9.1 per cent drop in approvals for apartments.
As for employment rates, these were looking strong through most of 2015 and were holding up until January 2016 when they experienced an unexpected slump. The total number of people with jobs fell in January by 7,900 when they had been expected to rise by 15,000. Employment rates are expected to slow further over the coming months.
These are all signs that point to a need for action in the future – but none seem severe enough to stimulate an immediate move. Perhaps for now the economy is holding in the balance, but a major shift in one, or all of these areas would encourage the RBA to take a different outlook. Historically, we know the RBA won’t be in any mood to make a knee-jerk reaction and will likely look at how things develop over a six month period.
The other wildcard this year is completely out of the RBA’s control – elections. Both here in Australia and overseas in major power houses like the US, elections bring elevated uncertainty about government, leadership, policy and change and makes for an interesting 2016.

09/03/2016

Pre-approval can be your best friend, or your worst enemy. Make sure you understand the fine print when your lender pre-approves you.

Pre-approval can be your best friend, or your worst enemy. Make sure you understand the fine print when your lender pre-approves you. The first few months of the year are always busy for property investors. Not wanting to get caught out by any further changes to bank lending policy, many investors have been seeking pre-approval for their investment loans early. In case they find the perfect property, they’re working out their limits and starting the paper trail in anticipation. Or at least they think they’re ready.

Be wary that a pre-approval doesn’t always mean a loan offer is guaranteed. There are a number of nuances included in pre-approvals that could halt a loan, so it’s beneficial for investors to understand what they are.

As a rule, you’ll find that if your lending needs are straightforward, and you’ve provided the right paperwork to tick all the boxes, your pre-approval will be straightforward as well. However, if you know you’re not going to tick the boxes, and you want to ensure your dream property doesn’t slip through your fingers, you should understand what that fine print means.

What to look out for:
1. Pre-approvals that are subject to credit checks, or lenders’ mortgage insurance, will leave you the most exposed – because the lender hasn’t done the critical checks to determine the risk of providing you with the loan.
2. The most common condition you’ll come across is that the loan is subject to a satisfactory valuation of the property. However, the use of the term “satisfactory” can mean a number of things to different lenders. It could mean ensuring that the property isn’t a serviced apartment, or that it’s in the right residential zone and isn’t zoned mixed use – so make sure you understand what your lender is looking for when they use the term - particularly if your property has unique characteristics.
3. What you’ve paid for the property will need to stack up against recent comparable sales. For rural areas particularly – lenders want confidence they can sell a property quickly if they need to – so some won’t lend if the market is slow or weak, or you’ve paid more than market rate for the property.
4. Ask your lender if there are any risks of over exposure in the area you’re looking in. Some lenders set restrictions as to the number of loans they will provide for properties in any one given area.
5. The property you want to buy will need to reflect the property outlined in the pre-approval, so don’t bid on a commercial property if you were pre-approved for a residential home. The type of property you want to buy can affect the size of the deposit you need to have saved. Many lenders will require a different loan-to-value ratio for an apartment, warehouse conversion, free standing dwelling or a commercial property.
Get it right and you’ll get it quickly.

If you go through the fine print in your pre-approval and make sure you have as few conditions as possible, you can act on the loan pretty quickly when the perfect property comes up. The best case scenario is you have a loan pre-approval subject to valuation – which means all that needs to be completed is a formal valuation of the property. The valuer can take between two or three days to do the inspection report. Once your lender has the report and can made the final assessment that the property is satisfactory, they’ll issue it as unconditional.

If you’re unconditional, you’re ready to go.