Archive for the ‘westpac’ Category

Here’s an interesting look at the current state of Australia’s credit card debt in an infographic by the guys at debtconsolidation.com.au ..

Source: DebtConsolidation.com.au

Everyone is familiar with consumer warnings on products. You know that cigarettes are deadly, alcohol is dangerous and if youre allergic to peanuts, you need to keep a close eye on food product labels.

Imagine if your Westpac credit card came with a warningusing this card can be extremely harmful to your finances. It may sound like a joke, but in the UK credit card warnings may not be too far from the truth. The British government has previously proposed that its Consumer Credit Act be updated with a requirement for lenders to warn consumers of the dangers of making only the minimum monthly payment on their credit card.

Back in Australia, this kind of legal requirement would be useful in helping to raise awareness of the dangers of making just the minimum monthly repayment. We owe millions on our collective credit cards and, while this works brilliantly for increasing the amount of profits made by banks such as Westpac, it is creating a nation-wide spiral of debt.

Next time you receive your Westpac credit card statement, look at the minimum amount payable. Paying back this amount may get your credit card bill out of your mind for the next month, but it means you will be holding onto your debt for much longer than you should.

If you owe even a few hundred dollars on your Westpac credit card, making the minimum monthly payment will cover the interest but will barelyif at all touch the principal of your debt. Add in the Westpac fees and charges you meet along the way and you could easily find your credit card debt increasing as you make the minimum repayment amount.

Credit cards, such as the range of products provided by westpac, generally attract a much higher rate of interest than other types of credit, such as home loans. As you are likely to owe much more on your home loan debt and will need to look at debt consolidation loans, like many people, you may try to put any extra money towards your mortgage repayments. If you have a credit card debt, you should work towards clearing this first, through making higher repayments or consolidating your debts. The money you will save over time on Westpac credit card interest can be put towards your home loan and used to build your wealth, rather than dissolve your funds and contribute to the bank profits.

You get up most mornings, swill a cup of tea or coffee, grab your keys and rush out of the door to get to work in time for that early meeting. Sound familiar? If youre tired of working hard for your money, look into ways that you can make your money work for you.

One way of using your income to work to your advantage is by using it to reduce the amount of interest you pay on your home loan. How? Most banks and lenders offer an offset account, or Westpac customers may choose to use SmartPay.

How does westpacs SmartPay work? Its simple. You have all of your income paid directly into your home loan account. In order to make bill payments and access your cash for everyday living expenses, you can arrange direct transfers from your home loan account into other Westpac transaction accounts, or have your bills paid directly from your home loan account.

Using a facility such as Westpacs SmartPay means that every dollar you have paid into your account works for you by reducing the amount of interest payable on your home loan. This way of banking also gives Westpac customers an incentive to be budget-conscious, as the more money you can keep in your home loan account, the less interest you pay.

SmartPay could save Westpac customers thousands of dollars in interest charges, which means they could pay off their home loan debt sooner and slash years from their home loan terms.

Westpac allow the SmartPay facility to be used on their Premium Option Home Loan, Rocket Payday Loans , Rocket Investment Loan, Rocket Access Equity Loan, Rocket Equity Investment Loan, Rocket construction finance and Equity Access Loan, but other loan types are not able to take advantage of the facility. Also make sure you look at the settlement buyers guide to know what you need to do when settling.

A simple strategy such as using Westpacs SmartPay could be an effective way to have your income working for you, by saving you money on your home loan. Similar facilities are offered by other banks and lenders, so be sure to shop around for the features you need in a home loan before making your choice. Speak to your financial broker for further advice on how you can use your income to help out with your home loan.

With the number of home loan products available on the market, home buyers have access to more specialised features than ever. When exploring your home loan options, speak with your financial broker to find the features that best suit your personal situation.

Repayment holidays are a feature offered by many banks and lenders, including Westpac. The idea behind repayment holidays is that if you have built up funds in your home, you can take a break from loan repayments for a period of timeusually between three and six months. The extra money that you have built up in your home is used to cover the repayments over this time.

Having a break from making your regular repayments to westpac may sound like a chance to enjoy some extra cash, but look carefully into this option before you decide whether it is right for you.

For a start, you need to activate the repayment holiday feature if it is available with the type of Westpac home loan you have. Depending on your home loan type, a repayment holiday fee may apply if you take advantage of the feature.

Although a repayment holiday may sound like a financial breeze, bear in mind that you will still be charged interest on your Westpac home loan during the holiday period, which means you will owe even more money when you start to make regular repayments again.

To take a repayment holiday from your Westpac home loan, you need to have built up extra cash in your loan balance. So much extra that it is able to cover the number of repayments that you miss during the holiday period. If you have managed to make this amount in extra repayments towards clearing your debt, after careful consideration of your options, it may seem a waste to use it on a repayment holiday.

If you think you may have trouble meeting some of your future home loan repayments, or need to access some extra cash for a short period of time, speak with your financial broker as soon as possible. Other options, such as using a redraw facility, may be more suited to your situation and will not erode the extra repayments you have been able to make.

Economic news about the Australian economy as at 28 August 2009 focusing on next weeks interest rate announcement presented by westpac Banking Corporation´s Senior Economist, Justin Smirk.

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Is it time to move out of your rental property and look at buying a place of your own? Then its time to get organised with your finances, especially when it comes to saving for your home loan deposit.

Working to put aside as much money you can for your home loan deposit means that you are likely to have a wider range of home loan options available to you. While there are no-deposit home loans available on the mortgage market, these can attract other costs, such as a higher interest rate.

Generally, most type of home loans will require a deposit of at least 5 to 20 per cent of the value of the property, whether you borrow from an independent lender, or one of the big banks, such as Westpac.

Ideally, you should aim to save at least 20% of the deposit to avoid the added cost of Lenders Mortgage Insurance (LMI). This is required by most lenders, including Westpac, if you borrow more than 80% of the value of a property. The purpose of LMI is to protect Westpac in case you are not able to make any of your loan repayments.

The price of property has generally sky-rocketed over the past years, so saving a large deposit is not always possible. The good news is that LMI can be capitalised, which means the cost is added on to the total cost of your Westpac home loan.

One of the criteria you need to meet for your first westpac home loan is the ability to show that your deposit consists of genuine savings. Westpac define genuine savings as regular deposits made into your own bank account over a minimum of three months, share certificates or a term deposit you have held in your name for at least three months. Once you have owned property, the money from the sale of a previous property can also count toward you genuine savings.

Genuine savings are required so you can prove to Westpac that you have managed your money and have gradually increased your savings over time, rather than having a lump sumwhich may have been a giftinto your account just prior to you applying for a loan.

So, how can you save up for a Westpac home loan deposit? Creating a saving strategy is simplespend less than you earn and save the rest. Speak to your financial broker for information on your first home loan application.

If youre a car buff, you might have personalised licence plates, custom-made seat covers and perhaps you even grew up sleeping in a racing car bed. Did you know you can now get a car-themed credit card from Westpac?

Specialised banking products such as Westpacs Holden MasterCard are a new way that banks are finding to tap into niche markets and make more money from their customers.

The Westpac Holden MasterCard works like a regular credit card, but 10% of what you spend counts towards earning a rebate of up to $3,000 on a new Holden.

Westpacs Holden MasterCard holders are entitled to a bonus 1% rebate for every dollar that is spent on Westpac General Insurance. An extra 2% rebate is applicable for every dollar spent at Holden Retailers, although this does not include purchases of new or used cars.

Working in a similar way to a credit card rewards scheme, the Westpac Holden MasterCard allows card holders to accumulate the rebate for a maximum of five years. To take advantage of the rebate, the card holder must buy a Holden car within five years of beginning to earn the rebate.

The problem with a product such as Westpacs Holden MasterCard is that like a credit card rewards scheme, it encourages card holders to spend up on credit in order to receive the reward, which in this case is a discount on a car.

Just as you should shop around for different types of credit card, you should also shop around for a car with a number of dealers before you make a decision on a make and model. This affiliation between Westpac and Holden works to their advantage by encouraging customers to spend a lot of money with each company, but there is not so much of a benefit to the card holders.

The westpac Holden MasterCard has an annual fee of $55. This fee is waived during the first year, but the fine print states that other fees and charges still apply during this time.

Discounts and offers are available when using the Holden MasterCard at any of the promotional partners, but these discounts merely create an incentive to spend on credit and make Westpac money in the form of fees and interest charges.

Generally, you should avoid using a credit card, from Westpac or any other lender, unless you can afford to pay off the balance in full at the end of every month. A better alternative is a Visa or MasterCard debit card, which can be used in all the same situations as a credit card but allows you to use money that you already have, instead of credit.

VAQ-139 2007 westpac, USS Ronald Reagan CVN-76

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Is there a tap in your house that drips but you havent yet got around to fixing it? Did you know that by replacing the washer, you could save hundreds of dollars on your water bill in the long term? If this is incentive enough to find the time to fix your dripping tap, wait until you hear how you could save thousands of dollars on your home loan by making just one small change.

Whether your home loan is with Westpac or any other lender, this one change could not only save you thousands of dollars, it could reduce the term of your home loan be several years.

Are you ready? Here it is.

Simply switching from monthly to fortnightly home loan repayments can save you thousands of dollars in interest charges, and clear your debt sooner.

Before you stop reading in disbelief, here is how it works. Say you make monthly home loan repayments to Westpac. This means you make 12 repayments over the course of a year.

Everybody knows there are 12 months in a year, but a lesser known fact is that there are 26 fortnights. Making 26 fortnightly repayments to westpac is the equivalent of making 13 monthly repayments, which means one extra repayment every year than you would make with a monthly repayment scheme.

It may not sound like much, but even one extra repayment in a year can make a huge difference to your Westpac home loan debt. Finding a whole extra repayment in a year can be a big task, but by paying fortnightly, you would barely notice the difference in your cash flow.

Every bit extra that you are able to pay towards your home loan helps you to reduce the principal of your Westpac debt sooner. This means your loan will attract less interest, which means even more of your cash can go towards clearing your principal.

Its common for people to get paid on a monthly basis, so having a Westpac home loan repayment automatically deducted from their account has traditionally made sense. Most home loan products, however, allow for fortnightly repayments and its a simple switch well worth making.

Buying your first home is a huge step and it is one of the most important purchases you will ever make. Ideally, your first home will be a stepping stone on the way to building a whole portfolio of property investments, so it pays to do your homework before buying your first home.

As one property purchase may lead to another, banks and lenders are eager to attract first home buyers who are likely to need to use more of their financial solutions over the years to come. As a result, most of the banks offer specialised first home buyer solutions, such as range of options offered by Westpac.

The team at westpac are able to help you through the process of applying for a home loan, but bear in mind they are only able to offer Westpac products. Independent financial brokers have a wider range of products that are likely to offer more competitive home loan deals.

If you dont have a deposit saved, this is not necessarily a barrier to applying for Westpac home loan. Westpac can lend up to 100% of the value of your property with their Westpac Family Guarantee, which allows eligible borrowers to use their family home as security.

Of course, even though Westpac can loan you 100% of the money required to purchase your first home, remember that you still need to raise enough cash to cover the upfront expenses of home-buying which can include stamp duty, government fees and charges, tax, insurance and estate agent fees.

Westpac are also able to assist first home buyers with applications for the First Home Owner Grant. This is around $7,000 in most states of Australia, and can be extremely useful in covering some of the costs of buying a home for eligible applicants.

The Westpac home loan team can help first home buyers to understand the range of features available with their Westpac home loan products, and work out which of these featuresfor example, securing as low an interest rate as possibleis best suited to their home loan borrowing needs.

Before you enter the property market, you should enlist the help of a financial broker who can help you through the process and access a wide range of home loans rather than restricting yourself to one lender. Do your homework early and youll soon reap the rewards of owning your own home.