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Darren Steele Finance, Suite 4 251 Lower Heidelberg Road, Ivanhoe East (2026)

05/10/2025

Can you top up your First Home Guarantee home loan?

The short answer: Maybe — but it might not stay under the guarantee.

Here’s why 👇
The First Home Guarantee (FHG) lets eligible buyers purchase with as little as a 5% deposit — the government guarantees the rest so you can skip LMI.

But if you want to borrow more later (a “top-up” or refinance):
🔹 Your new loan portion may not be covered under the guarantee.
🔹 The bank might need to reassess your eligibility.
🔹 You could lose the no-LMI benefit on the extra amount.
Tip: Always check with your lender first — ask whether your guarantee still applies before you increase your loan.

💬 Thinking of renovating or refinancing? Make sure you know how it affects your FHG status.

25/08/2025

🏡 New vs Old: What’s Changed in the 5% Deposit Scheme?

Big changes are coming to the Home Guarantee Scheme from October 1st, and if you're a first home buyer in Melbourne, this could be your golden ticket! 🎟️

Here’s a quick breakdown:

🔁 OLD SCHEME

• ❌ Limited places (capped annually)

• ❌ Income caps applied

• ❌ Lower property price caps (Melbourne: $800K)

• ✅ 5% deposit allowed

• ✅ No Lenders Mortgage Insurance (LMI)

✅ NEW SCHEME (from Oct 1, 2025)

• ✅ Unlimited places — no cap on applications

• ✅ No income limits — higher earners now eligible

• ✅ Higher property price caps — up to $950K in Melbourne

• ✅ 5% deposit still applies

• ✅ Still no LMI — saving buyers $15K–$42K

💬 This means more flexibility, more choice, and faster access to home ownership — especially in Melbourne’s competitive market.

04/08/2025

🏡 6 Key Things to Know About Reverse Mortgages!

Looking to access equity in your home without selling? A reverse mortgage could be an option — but it’s important to understand how it works. Here are 6 key things to know:

🔑 1. No Regular Repayments Needed
You don’t need to make monthly repayments. The loan is repaid when you sell, move into aged care, or pass away.

🎂 2. Must Be 60 or Older
These loans are only available to homeowners aged 60+. The older you are, the more you can typically borrow.

📉 3. Interest Compounds Over Time
Interest is added to the loan balance, so your debt grows faster the longer the loan is in place. This can reduce the equity left in your home.

📄 4. It Can Affect Your Pension
Funds accessed may impact your Age Pension, depending on how you draw and use the money. It's essential to understand how Centrelink assesses this.

🏡 5. You Still Own and Live in the Property
You retain ownership and can stay in your home for as long as you like, provided you meet the loan conditions (e.g. paying rates and insurance).

🧑‍⚖️ 6. Legal & Financial Advice is Required
You must get independent legal advice before signing — and financial advice is highly recommended to ensure it suits your retirement goals.

23/07/2025

📉 Thinking of applying for a loan after becoming self-employed? Here's what you need to know.

Becoming your own boss is exciting—but when it
comes to borrowing money, lenders see things a little differently.

💼 Why is it harder to get approved? When you're self-employed,
your income can be unpredictable. Lenders want to see proof of stable earnings, and that usually means:

-At least 2 years of consistent income from your business
-Detailed tax returns and financial records
-A strong credit score and low debt levels

Unlike salaried employees who can show a steady pay check, self-employed applicants need to demonstrate that their business is viable, and income is reliable over time.

⏳ How long do you need to wait? Most lenders require 2 full
years of self-employment before they'll consider your application. Some may accept 1 year if you have a strong history in the same field and can show consistent income.

✅ Tip: Keep your financial records clean, file your taxes on time!!

22/07/2025

🏡 Want to pay off your mortgage faster and save thousands in interest? Here's how! 💰

Let’s compare two repayment options for a $700,000 loan at 6% interest:

📅 Monthly Repayments
Term: 30 years
Monthly Payment: $4,196.85
Total Interest Paid: $810,867.32

🗓️ Fortnightly Repayments
Payment: $2,098.43 every 2 weeks
Loan Paid Off In: 24.54 years
Total Interest Paid: $637,183.28

🎉 Interest Saved: $173,684.05 by switching to fortnightly payments!

📉 Why it works:
You make the equivalent of 13 monthly repayments per year when paying fortnightly or weekly. That extra repayment goes directly toward reducing your loan balance faster and cutting years off your mortgage.

⚠️ Pro tip: Not all lenders calculate repayments this way – check how your lender processes extra payments!

16/07/2025

⏳ Why Do Business Loans Take Longer at the Big Banks?

If you’ve applied for a business loan at one of the majors and felt like it took forever — you’re not alone. Here’s why approvals can be slower at the big end of town 👇

🏦 1. Legacy Systems & Layers of Red Tape
Major banks have complex approval structures and old systems that aren't built for speed. Every step – from assessment to policy checks – can take days or weeks.

📚 2. Tighter Credit Policies
The big banks are more conservative and often require more documentation (tax returns, BAS, forecasts, etc.). This slows down the process, especially for small businesses or those with less trading history.

👥 3. High Volume, Low Flexibility
With large customer volumes, applications often sit in queues. Their credit teams can’t adapt quickly to unique scenarios or urgent needs.

⚡ How Smaller/Newer Lenders Compare
Smaller or fintech-style lenders are often tech-driven, with faster digital processes, simpler documentation, and fewer approval layers. That means faster answers — sometimes in 48 hours.

16/07/2025

👉 HEM stands for Household Expenditure Measure. It’s a benchmark banks use to estimate a borrower’s basic living expenses based on their income, location, marital status, and number of dependents.

📊 Banks use HEM to ensure your stated living expenses are realistic and that you’re not borrowing beyond your means. If your declared expenses are below HEM, the bank may adjust them upward to the benchmark – even if you live more frugally.

💰 How does your income affect HEM?

The higher your income, the higher your assumed spending under HEM. Why? Because it’s expected that higher income earners generally spend more on things like food, transport, clothing, and lifestyle.

🔍 So even if you think you’re a savvy saver, lenders may still apply a higher minimum expense level based on HEM for serviceability purposes.

15/07/2025

📊 Auction Market Snapshot ⁠— Week in Review⁠

🏠 National clearance rate: 72.2%

⬇️ Slightly down from last week’s 73.1%, but still strong and just under the yearly peak of 74.5%.

✅ It’s the 5th week in a row clearance rates have held above 70%.

📍 Melbourne:
Still Australia’s busiest auction market — even during school holidays.

🏡 630 homes went to auction (vs 767 last week, 628 this time last year).

📉 Clearance rate dipped to 70.5%.

⁠➡️ Overall, demand remains solid across the board.⁠
⁠

14/07/2025

📉 RBA Holds in July — But It's a Pause, Not a Pivot!

The dominant expectation heading into July was for a rate cut — but the RBA held steady. This wasn’t a pivot. It was a pause, and a cautious one at that.

The RBA isn’t rushing. They want to see clear evidence that inflation is tracking lower before making any move.
🔹 A rate hike? Unlikely — but not off the table.
🔹 A cut? Still possible — if inflation stays on trend.

Stay tuned. The data over the next few months will shape how the rest of the year plays out.

10/07/2025

🏠 Why Your Build Contract Can Be Higher Than the Bank’s Valuation – And What That Means If You Already Have a Loan on the Land.

Let’s look at a real-world scenario 👇
📊 Example:
Land Value: $800,000
Loan on Land: $500,000
Build Contract: $900,000
Total Project Cost: $1.7M

The bank orders a valuation and values the completed home at $1.6M.
They’re willing to lend up to 80% of that = $1.28M.
But you’ve already borrowed $500K for the land, so:
💸 $1.28M - $500K = $780K available for the build
❌ Build contract is $900K
💰 Shortfall = $120K that you need to fund yourself

🔍 Why Does This Happen?
Banks use what's called an "on-completion valuation" — they assess what your home would sell for in today’s market after it’s built.

That figure can be lower than what you’re spending, especially if:
-The suburb has capped resale values
-You’ve chosen premium upgrades
-Or the design is highly custom
It’s not personal — it’s just risk management from their side.

💡 Already Have a Loan on the Land?
Here’s the catch:
The bank subtracts your existing land loan from what they’re willing to lend overall. Based off the valuation & your borrowing capacity. That’s why you can end up needing to contribute extra funds to bridge the gap.

08/07/2025

📢 RBA Holds Cash Rate Steady at 3.85% – What It Means for You 🏦

Despite hopes for a rate cut, the Reserve Bank of Australia (RBA) has kept the cash rate on hold at 3.85% following today’s meeting.

Here's why:
🔍 Waiting for More Data
Inflation is easing (currently 2.1%), but the RBA wants more evidence that it’s staying within the target range before making further moves.

🧠 Split Opinions on the Board
Today’s decision wasn’t unanimous — 6 board members voted to hold, while 3 were in favour of a cut. This highlights the delicate balance the RBA is navigating.

🌍 Global Uncertainty
International trade tensions, particularly from new U.S. tariffs, are keeping the RBA cautious. They're watching global impacts closely.

💡 What This Means for You
If you’re a homeowner or business owner, your borrowing costs remain the same — for now. But keep an eye out: economists still expect possible rate cuts later this year (👀 August or November?)

📊 In the meantime, now's a great time to review your finances and plan ahead — especially as we wait for the next RBA move.

03/07/2025

📅 RBA Meeting Alert: July 7th & 8th 2025.

💰 Cash Rate Decision Incoming!

Australia’s economic eyes are on the Reserve Bank next week as the Monetary Policy Board prepares to meet on July 7–8. The decision will be announced on Tuesday, July 8 at 2:30 PM.

🔍 What are the experts saying?

All of Australia’s big four banks — CBA, Westpac, NAB, and ANZ — are forecasting a 25 basis point cut, which would bring the cash rate down to 3.60%.

📉 Why a rate cut?

Inflation is easing, now at 2.1%, within the RBA’s target band
Retail spending is sluggish
Wage growth is outpacing inflation
Financial markets have priced in a 97% chance of a cut.

🏡 What does this mean for you?

If passed on by lenders, a rate cut could mean lower mortgage repayments and better borrowing conditions. For a $600,000 loan, repayments could drop by around \$90/month

📲 Stay tuned !!

Darren Steele Finance

05/10/2025

25/08/2025

04/08/2025

23/07/2025

22/07/2025

16/07/2025

16/07/2025

15/07/2025

14/07/2025

10/07/2025

08/07/2025

03/07/2025

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