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Superfund lending

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Are you looking for a way to diversify your superannuation portfolio and achieve your retirement goals? Have you considered self-managed superfund lending? First things first, any decision around this or discussion must be held with a financial planner and your accountant, the right advice is paramount to ensure you stay compliant to the laws that sit around SMSF lending.  Self-managed superfund lending is a type of investment loan that allows your SMSF to use its funds as a deposit to purchase an investment property and borrow the remaining amount required to fund the purchase. This can allow your SMSF to invest in properties that it may not otherwise have the funds to immediately purchase. The benefits of SMSF lending include: Potential capital growth and rental income from the property Tax advantages such as deductions for interest and depreciation, and lower capital gains tax rate. Greater control and flexibility over your superannuation investments Ability to leverage your superan
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Maximising Your Mortgage: Understanding Offset Accounts

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As a homeowner navigating the intricate world of mortgages, it’s essential to explore all available options to optimise your financial strategy. One such tool that can significantly benefit borrowers is the offset account. In this article, we’ll delve into what offset accounts are and how they can work to your advantage. What is an Offset Account? An offset account is a financial product linked to your mortgage, typically a home loan. It functions as a transaction account where your salary, savings, and other funds are deposited. The outstanding balance in this account is then subtracted (offset) from the balance owing on your mortgage before interest is calculated. How Does it Work? Let’s break down the mechanics of how an offset account operates: 1. Linked to Mortgage: Offset accounts are usually linked directly to your mortgage account. This linkage allows the funds held in the offset account to directly offset the principal of your mortgage, reducing the interest payable. 2. Intere
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Let’s delve into the differences between a finance lease, commercial hire purchase, and chattel mortgage: Chattel Mortgage: Ownership: With a chattel mortgage, you own the asset from the start of the finance term. Security: The assets you purchase act as security for the loan. Interest Rates: Generally, chattel mortgage interest rates are competitive. Tax Benefits: There are GST benefits associated with chattel mortgages. Use Case: Ideal for businesses that want full ownership of the asset immediately. Finance Lease: Ownership: During the lease term, you don’t own the asset, but you may have the option of ownership when the lease ends. Ownership Benefits: You have the option of full actual ownership at the end of the term. Tax Deductions: Business tax deductions are available on lease payments. Use Case: Suitable for businesses that prioritize flexibility and want ownership benefits. Commercial Hire Purchase (CHP): Ownership: Similar to a finance lease, CHP involves leasing a
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Are You Really Ready to Secure Approval for Your Home Loan?

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As the housing market continues to evolve, one question looms large for prospective homeowners: Are you ready to secure approval for your home loan? Here are some key considerations to ensure you're prepared for this significant financial step. 1. Financial Readiness: Take a deep dive into your financial situation. Have you saved enough for a down payment? Do you have a stable income to support monthly mortgage payments? Understanding your financial readiness is crucial before approaching lenders. In todays market and regulation lenders will take a microscope to your finances and transactions. 2. Credit Health: Your credit score plays a pivotal role in loan approval and the interest rate you receive. Review your credit report for any errors and work on improving your score if needed. Lenders often look for a score of 620 or higher for conventional loans. We are able to obtain these reports for our clients as their mortgage broker. 3. Debt-to-Income Ratio: Lenders assess your de
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Bonds? Complicated or simple? What are they?

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Bonds? What are they? I’m sure you have heard this term thrown around or in the investment space a lot but what are they really? Lets have a super Quick Look covering off a few points on what bonds actually are -  Bonds are debt securities issued by governments, municipalities, or corporations to raise capital. When an investor buys a bond, they are essentially lending money to the issuer in exchange for periodic interest payments and the return of the principal amount at maturity. Consider it like an I owe you in so many years but ill pay you like I would a bank for a loan of money. Bonds are considered fixed-income investments because they typically pay a fixed interest rate over the life of the bond. This predictable income stream makes them attractive to investors seeking stable returns but remember, rates today will likely be very different to rates in 10 years, the bond is not variable, its fixed so make sure you are getting the right advice. Bondholders receive regular int
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Explaining LVR

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What is the definition of LVR?   Loan-to-Value Ratio (LVR) is a financial metric used by lenders to assess the risk of a loan by comparing the amount of the loan to the appraised value of the property securing it. It's expressed as a percentage. So how top you calculate this?  Its simple To calculate LVR, divide the loan amount by the appraised value of the property and multiply the result by 100. For example, if you have a $200,000 loan on a property valued at $250,000, the LVR would be 80% ([$200,000 / $250,000] * 100). How does this play into the banks Risk Assessment you ask?   Lenders use LVR to evaluate the risk associated with a loan. Higher LVRs indicate a higher risk for the lender, as the borrower has less equity in the property. Lower LVRs generally suggest a more secure loan. Well this is all great I’m sure you are thinking but how does this impact on Interest Rates?   LVR can influence the interest rates offered to borrowers. Lower LVRs may qualify for better in
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Commercial lease vs residential lease

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Commercial lease vs residential lease Lets break down the key differences in this mini blog for some bite size learnings 1. **Purpose of Use:** The primary distinction is the purpose for which the property is leased. Residential leases involve renting property for individuals or families to live in, while commercial property leases are for business purposes, such as offices, retail spaces, or industrial facilities. 2. **Lease Terms and Length:** Residential leases often have standard terms, usually 6 or 12 months, and can be renewed. Commercial leases, on the other hand, tend to have longer terms, commonly ranging from 3 to 10 years or more, reflecting the stability businesses require. 3. **Rent Determination:** Residential rents are often influenced by factors such as location, property features, and demand in the housing market. In contrast, commercial rents are determined by factors like the size of the leased space, location, and the potential for business success in that area. 4.
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