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
In what is suspected to be a “man in the middle scam”, funds were unwittingly deposited by a purchaser into an east coast bank account in the lead up to a settlement and then transferred by the scammers to an overseas account resulting in a significant loss of $557,000.
Typically, this type of scam will occur when the contents of person’s private emails are accessed and details of future financial transactions are seized upon by scammers. Victims will be contacted by what they believe to be their agent via a genuine email address when in fact it is the scammer who has assumed the identity of a recipient requesting the transfer.
Scammers are attracted to targeting property professionals and their clients due to the potential for high yield lucrative opportunities.
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:
Spring time sees more property settlements and transactions across Australia than any other season, according to leading conveyancing technology experts GlobalX.
GlobalX CEO Peter Maloney said from September to November the grass is greener, gardens are in full bloom and the weather is comfortably warm, making for optimal house selling conditions.
Mr Maloney said spring sales were often driven by the desire for a new beginning, with individuals, couples and families preferring to move before the end of the year.
“Buyers who have children prefer to get settled ahead of the new school year, and a spring sale means relocation can take place near or over the holiday period, allowing ample time for unpacking,” Mr Maloney said.
Leaks can be extremely wasteful and costly. Regularly checking taps, pipes and fittings around your property could save precious water and precious money!
Are you aware that your build might have extra costs to meet the requirements of Bushfire Attack Level (BAL) assessment/report being obtained and being below a certain level to ensure building is less prone to bushfire loss.
These requirements monitored by the local council could add thousands of dollars to your build costs.
Things could be looking up for homebuyers, with a new report forecasting a drop in property prices over the next three years. But could this also signal the end of the Australian property market golden era?
According to BIS Shrapnel's Residential Property Prospects 2016-2019 report, median house and unit prices in our capital cities will be lower by 2019. This is due to a perfect storm of slower population growth, falling immigration levels and an oversupply of new homes.
The Australian Prudential Regulatory Authority's recent work to tighten lending standards has slowed investor activity, also contributing to the downward trend. Investors have previously been a huge driver of market demand, particularly in Sydney and Melbourne.
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.
AICWA recently advised members of the decision by The Registrar of Titles Ms Jean Villani to introduce a change of lodgement processes by August 1st 2017.
On August 1st this year, Landgate introduced changes to lodgement process affecting mortgagees, specifically, for the electronic lodgement of mortgages and discharges of mortgages (via PEXA).
It is now envisaged that the next step towards paperless conveyancing is for the scope of eligible document types to be broadened so as to include:
Landgate is seeking comments and feedback from the AICWA on the proposed change. While the finer details of the process have yet to be determined Landgate have indicated that they wish to understand what potential issues or considerations exist in implementing this “next step”. An investigation followed by a lengthy consultation period will hopeful ensure the creation of processes that are accepted by the majority of AICWA members. It is important to note that there are many external impacts that will result from this change that impact conveyancers. Landgate are keen to understand these impacts and where possible work with AICWA to achieve or facilitate positive outcomes.
Listed, Sold or buying a property market value of $2 mil. or over?-ATO clearance certificate is required!
Contracts dated 1 July 16 on wards, will have the new requirements on ALL transactions with market value of $2 million or over.
Unless the Seller provides an Australian Taxation Office (ATO) 'clearance certificate' for each registered proprietors name (matched to the title) to the buyer 2 business days prior to settlement (-timing subject to REIWA special condition).
Then the Buyer must withhold 10% of the Purchase price (more specifically the 'First element of the cost base'-Capital Gains Tax defined term) from the Seller and apply for an ATO Payment Reference Number (PRN) then remit that payment to the ATO once settled, and before Title registration.
Even if Selling or Buying a percentage, where a total property value (aggregated/extrapolated) $2 million or more would likely impact that transaction.
Designed to catch Tax evaders, the new law places liability on the Buyers to withhold payment from the Seller unless they are given a clearance certificate, or exempted by approved variation.
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