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Good Brokers Australia

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02/06/2024

Debt recycling is a great way to save on tax and invest at the same time!

Debt recycling is the conversion of 'bad (non-deductible) debt into 'good' (deductible) debt.

There is a lot of information out there about debt recycling and what it is, but implementing debt recycling without a broker who knows the best lenders to support the strategy and how to actually implement it is a recipe for disaster.

One of the most common mistakes I see is clients who have used a broker without experience in the process, or who have tried to DIY it themselves, and they end up contaminating their funds or their loan. This becomes a very costly exercise to unmix the loan.

I've worked with dozens of clients and helped them implement debt recycling, working with one of Australia's most influential tax lawyers, to properly understand how debt recycling works and how to implement it.

If you're interested in understand whether debt recycling would be of benefit to you, then send me a message.

26/05/2024

Looking to borrow?

In this follow-up edition to our self-employed edition, we look at tips to help you get a loan as an employee fir a company.

Some of the factors that can really help, although they seem super obvious, are:

- knowing what is on your payslip. I.e. How much do you get paid? how often? are there any deductions? Etc

- do you know your outgoings each month? If you've had a big holiday or some birthdays recently, then consider being frugal for the next couple of months if you're wanting to potentially improve your borrowing capacity.

- have you got credit cards or other credit facilities you don't need? Even if you repay your CC off in full every month, consider lowering your credit limit or closing the facility if applying for a loan. Banks will always look at your limit, so if you don't need it, then close it!

Also, there are now more lenders that will consider a 1 year bonus history! So if you got paid a bonus, it's a great time to get a loan.

If this has helped you, or you know someone who it might help, please like and share!
Thanks!

18/05/2024

What does the 2024 budget mean for your borrowing capacity and your mortgage?

1) Small business continues to receive the $20k instant asset write-off, and now receives the energy bill relief.

Be mindful that any non-recurring income, such as a rebates and grants can't be used for servicing.

2) FHB schemes will continue and HECS debts will be indexed differently, saving students on average $1200.

HECS benefits are unlikely to impact servicing, but may result in them being paid off sooner.

3) Tax cuts will benefit people varyingly, but the savings should improve borrowing capacity.

Unfortunately, there is no clarity on interest rate movement. There is growing sentiment that cash rates will hold steady until early 2025.

So, what am I and my clients doing as a result of these outcomes?

1) Negotiating rates with current lenders or looking at refinancing to cheaper rates to provide more cost relief.

2) Continuing on track to purchase properties. The steadiness of rates has given certainty to borrowing capacities, making it easier to budget for your new property.

22/04/2024

Another happy customer!

15/04/2024

We had to submit another pre-approval for a client after they changed their mind!

I had a good discussion with a client recently about which rate to choose for their first investment property.

Initially, they had wanted to go with an IO loan. However, later they began to change their mind and we had a good discussion about the pros and cons of P&I vs IO.

Some of the points we discussed are captured above, others - such as how it impacts much you can borrow, are more nuanced discussions.

It's important that you feel heard by your broker, and so after the client was clear on the differences , they confirmed that they wanted to go with a P&I rate loan instead.

Importantly, the client is happy with their new rate and pre-approval!

10/04/2024

If you work part-time, Mr Collett believes that you're less capable than your FT counterparts.

Why he's chosen to discriminate against financial planners and mortgage brokers is unclear, but plenty of my clients, friends, and colleagues work part-time in their professions and are incredibly competent in their jobs.

What is convoluted in his article is that he really seems to be calling out brokers who haven't written loans for an extended period. That is a valid question to ask a broker, as that indicates their familiarity with current policy, not their employment status.

If I was choosing between a broker who worked full-time and settled $500k/month vs a part-time broker who settled on average a $1M/month, then I would happily go with the part-time broker.

Just like if I was going to choose a dr, then I'd happily choose the part time dr with multiple positive reviews or testimonials over the full time Dr who has terrible reviews.

In essence, experience and customer-service trump employment status. For me, this belief that if you work PT then you're less capable is an extremely dated world view.

https://www.smh.com.au/money/borrowing/thinking-about-using-a-mortgage-broker-here-s-one-thing-you-should-always-ask-20240404-p5fhcs.html

01/04/2024

Here, we go through 3 steps to put you in a better position when it comes to applying for a loan when you're self-employed.

Profit is going to be the biggest driver of how much you can borrow, but it also is going to mean more tax for you and your business. So, plan ahead for when you're looking to borrow to minimise the tax in the other years.

22/03/2024

When I went to get my first loan, and before becoming a broker, I went to direct to my bank. I sat down with someone and was told I could borrow the amount I requested and was told a rate.... that was it.
For some people this might be fine, but I wanted to know if that was the best rate I could get.

Thankfully, I went to a mortgage broker and discovered that there were a number of banks who would offer us a loan of the same amount or more and at cheaper rates!

Being a home owner and property investor, I understand the importance of having a low interest rate and why it's important to clients too.
However, there are more important things than just rates.

My mortgage broker at the time had shown me my borrowing capacity, which allowed me to buy a better quality property than what I thought originally I could afford. And that's something I try to inform clients too.

Extra $$$ could help you afford a house instead of a unit, or buy in a suburb closer to the city.

Lender selection is key, not just rates, so if you're looking for a new loan, or refinancing an existing one, try using a mortgage broker. It may open your eyes to better options like it did for me.

02/03/2024

How my client bought a home with a 10% deposit, paid no LMI, and got a cheaper rate!

This client wasn't a medical professional, they weren't a lawyer, or any other special profession that normally gets LMI waived.

Yet they still avoided any LMI and got a cheaper home loan rate! How?

Security guarantees!

My client's parents went security guarantors and used their home's equity, so that my client could buy his home faster, avoid paying additional fees, and get a cheaper rate.

Typically high income earners aren't eligible for any of the major banks deposit guarantees, which means they have to stump up at least a 20% deposit or pay LMI.

Using a security guarantor can be a great option for you if:
1. You don't have a 20% deposit
2. You're ineligible for the first home deposit guarantee
3. Your parents have a property with equity available.

Think this might be a good solution for you?

Follow for more tips and send an email through our website (www.goodbrokers.com.au) to book a 1:1 meeting

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