Commissioner Kenneth Hayne has delivered recommendations from the royal commission into financial misconduct that could see consumers forced to pay upfront mortgage broker fees. The recommendations for the radical shake-up to the broking industry was not unexpected, in early 2017 The Australian Securities & Investments Commission (ASIC) conducted a “Review of mortgage broker remuneration”.
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These are the occasions when a peak body association has to advocate practical solutions that find a balance between its member’s interests and consumer expectations. The current broker model is beset by aggregators and incentivised commission structures but yet on the other hand has seen a rise in smaller lenders who are offering exceptional rates which have been drivers for competition in the marketplace. Homebuyers are typically highly satisfied with their brokers in facilitating funds to purchase their home but are increasingly finding they are unable to service their loans.
When compared to the settlement/conveyancing profession, which is a lean mean industry, our continued sustainability is reliant upon workable regulatory frameworks that deliver competition and independence of the professionals servicing consumers. The AICWA has, and continues, to advocate for regulatory frameworks that ensure we do not compromise the reason why settlement agents get up in the morning, after all it’s working in the client's best interest that matters!
Source:6th February 2019 AICWA e-Newsletter
On 1 January 2019, foreign transfer duty and foreign landholder duty came into effect by amending the Duties Act 2008. The additional 7% duty applies to acquisitions of residential property where the buyer or transferee are foreign persons, including foreign companies and trusts.
What does this mean to you?
Every buyer or transferee that acquires or purchases land in Western Australia is now required to complete and lodge a Foreign Transfer Duty Declaration Form within two months of executing the dutiable transaction.
Budget 2017 Update
GST On New Residential Purchases
From 1 July 2018 the Federal Government will require all purchasers of new residential premises (new builds) to remit the GST component previously provided by developers/builders directly to the ATO as part of the property settlement process.
Little is known of the changes other than what has been recently posted on the ATO website HERE
New Charge for Foreign Owners for Empty Properties
Foreign persons who apply for approval to purchase residential property after 9 May 2017 will face a new annual vacancy charge to be imposed if the property is not occupied for at least six months per year.
The charge will be levied annually and will be equivalent to the purchase application fee imposed at the time the property was acquired by the foreign investor.
Details of the new charge can be viewed HERE
FIRB approval for sale of new apartments limited to 50%
Developers selling under a New Dwelling Exemption Certificate issued by FIRB will now
Confused about home loan pre-approvals? Here's everything you need to know before you start house hunting.
What information do you need?
First, your broker will want to build a comprehensive picture of your finances. To do this, you'll need to provide evidence of everything including:
Favourable interest rates are a borrower's best friend, but should you lock in a low rate or go with a variable rate? Here are five things to consider.
1. How low can rates go?
Interest rates are at historically low levels and the current outlook suggests there may be further cuts in the medium-term future. If you lock in your rate now, you won't reap the benefits of later decreases. The question is: how low do you think the rate will go before it starts to climb back up? Timing is crucial if you want to lock it down at its lowest point.
2. Balancing the budget
How are your budgeting skills? If you want to know your precise repayment obligations for the next one, three or five years, then a fixed rate term can give that to you. Be aware, however, that you may not secure the best rate. Consider this route if certainty is important to you.
3. Fixed or flexible?
Fixing a rate denies you some flexibility. Once you fix a rate, some lenders won't let you make extra repayments to reduce your principal. If you come into extra money, such as a work bonus or an inheritance, you lose the opportunity to make what could be a sizeable dent in your mortgage.
4. Selling points
A fixed rate may put you at a disadvantage if you're looking to sell your property in the foreseeable future. Lenders may charge a break fee if you make changes to your loan or pay it off early, which often happens when borrowers sell.
5. Fixed vs variable: It's about 50/50
According to a study conducted by Canstar, a website that compares loans, the advantage of a variable versus fixed rate is fairly small over time.
Canstar compared an average three-year fixed-rate loan with variable rates over two decades. People who fixed their loan did better for 112 months, while those who chose variable were ahead for 123 months. "That's pretty close to a 50/50 bet," remarked Mitchell Watson, research manager for Canstar.
Seeing interest rates decrease understandably prompts borrowers to think about fixing their mortgage to a low rate. If you're weighing up the options, consider the benefits and drawbacks of locking in a low rate versus the flexibility of a variable loan according to your personal circumstances.
Landgate (WA Land Title OFfice) force PEXA use; Electronic lodgement of stand-alone Mortgages and Discharges of Mortgages will be effective 1 August 2016
On 4 April 2016 a letter was distributed to industry bodies and Customer Information Bulletin (CIB) recipients. This letter notified Landgate’s intention to introduce changes to the lodgement process for mortgages and discharges of mortgages that will affect mortgagees, their conveyancers, lawyers and lodging agents by 1 August 2016.
Industry bodies and CIB subscribers were invited to provide feedback on the changes. The timeframe for receiving feedback has now ended. This CIB is to notify that Landgate will be progressing activities to achieve the 1 August 2016 timeline.
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