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House rules change

Discussion in 'Finance & Banking' started by Billv, 15th May, 2008.

  1. Billv

    Billv Getting there

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    Author: : Lesley Parker
    Date: May 14, 2008
    Publication: Sydney Morning Herald (subscribe)

    In the space of six months, just about everything anyone thought they knew about the Australian home loan market has changed. Mortgage rates no longer track the official rate set by the central bank; borrowers must jump through hoops rather than fend off overzealous lenders; instead of racing to beat rising house prices, prudent buyers must factor in the possibility of stagnant or even falling values.

    Previous assumptions about where the best home loan deals lie need to be examined, then re-examined. Many borrowers spurned non-bank lenders last year, for instance, only to be socked by higher rates from the big banks this year.

    Resi Mortgage Corporation's head of consumer advocacy, Lisa Montgomery, says the result is that people are confused and suffering from inertia when it comes to their home loans.

    "A lot of people have lost confidence in all lenders. They're not sure what they should do," Montgomery says.

    So, let's look at some of the big questions facing borrowers in this changed landscape.

    http://www.domain.com.au/Public/Art...dex=NationalIndex&headline=House rules change
     
  2. Jacque

    Jacque Team InvestEd

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    Thanks for that Bill- I think the end of 105% lends is a great idea and long overdue. Particularly for first home buyers, having some savings history at least demonstrates that purchasers are committed and able to save regularly, as mortgage payments certainly don't take holidays :)

    I found this worthwhile mentioning:

    Review your credit reference. This includes information such as inquiries about you by lenders, any credit card defaults and bankruptcies. You can check your credit reference at My Credit File - Veda Advantage.

    Most borrowers neglect to do this, and I think it's a good idea to do it annually, as credit checks can also have innacurate information, or contain surprises you're not aware of (eg overdue mobile phone bills) which do affect your credit rating with lenders.
    Don't bother paying the $27 fee either- you're actually entitled to view your own records for free- see the site, but it generally only takes 7-10days.
     
  3. MJK

    MJK Well-Known Member

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    Jackie,

    Do you think it is secure to give all the info required to Veda to obtain the file?

    MJK
     
  4. Jacque

    Jacque Team InvestEd

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    Well without it they won't be able to verify your ID and so you won't get to see it. Since Privacy Laws changed some years ago now, companies are very aware of rights and security breaches.
    If you're concerned, try ringing them and seeing if there's any alternatives.
     
  5. Billv

    Billv Getting there

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    MJK

    Why are you concerned?
    They already have this info on file don't they?
    They will cross check your supplied info with the info on file.

    Cheers
     
  6. Billv

    Billv Getting there

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    I wonder if we will have the same situation here when our interest rates drop.

    Quote from the article
    "In Britain, a recent Bank of England rate cut wasn't passed on uniformly, with new borrowers and those coming off fixed-rate loans reported to have missed out on the savings. Asked what would happen here in the event of an official rate cut, Steve Blinkhorn, the head of home loans for St George Bank, says in the past the bank has been quick to pass on any rate cuts. He says, though, that can't be guaranteed "in the current environment"."