Most borrowers would understand that getting a low interest rate can save you hundreds of thousands of dollars over your lifetime. What is not understood is how an effective mortgage strategy can actually make you hundreds of thousands of dollars over the same period. Borrowers don’t need to consult an expert to find a low rate. The only skill required is being able to use a search engine. On the other hand, understanding how an effective mortgage strategy can create wealth is complex and not understood by most lending professionals, let alone consumers.
In our video series Mortgage Strategy 101 Ep. #9 David shares with you how to maximise your tax deductions and save money by paying for tax deductible expenses out of a redraw facility on your investment loan as opposed to spending savings from your Grow offset account as this is reducing your home loan interest which is non-deductible.
Recent regulation changes will directly impact the amount you can borrow - significantly. So, how much - I hear you ask? Let’s take a look at how much your borrowing capacity has increased and how this is impacting the property market... The Australian Prudential Regulatory Authority (boy that’s a mouthful), otherwise known as APRA, reduced the assessment rate that banks use to determine [...]
In our video series Mortgage Strategy 101 Ep. #8 David shares with you how to maximise your ability to hold property as you purchase your next property as well as maximise future possible tax deductions. If you have purchased a home that may one day become an investment property, then this element of your mortgage strategy is critical to you and maximising your future tax deductions.
David Johnston wrote this article for Domain on August 6, 2019 and it was also published in The Age and The Sydney Morning Herald. Home owners considering upgrading may be wondering whether it’s possible to keep their current home and convert it to an investment property. If your existing property is a decent asset, you [...]
The offset account is the bank’s greatest invention!Most people understand that an offset account will reduce the interest payable on your mortgage 356 days a year in exactly the same way the interest would be reduced if it was paid directly into a loan. What many people are unaware of is that there are many more ways that the effective use of offset accounts can enhance your ability to pay less tax, hold properties, manage risk and improve your cash flow.
In the last two months the Reserve Bank of Australia has announced not one, but TWO rate reductions! Both times, the RBA cut rates by 25 basis points, amounting to a total reduction of 0.50% But do you think the lenders have passed on the full rate reduction? Of course not... So, we thought we would let you all know [...]
Financial worry is one of the biggest causes of stress in our lives, but it doesn’t have to be. We can make a conscious decision to maintain control and order over our money, or we can feel like our Money Management is in a perpetual state of chaos. The enlightened realise this is a choice that must be backed up by sustained effort until habits are built. We don’t need to live in chaos. The many moving pieces of our financial world can be tamed and orderly. We can manage our money like a farmer skillfully herds sheep into a pen rather than having to deal with a bunch of stray cats that are always slipping away from us!
In our video series Mortgage Strategy 101 Ep. #6 David shares with you how you can get the best use out of your offset accounts – what we call ‘the banks greatest invention!’This is because the offset account is the grease that spins the wheels of many of the other Mortgage Strategies.
Why is it so important to have a Property Plan before you make your next purchase? The simple answer: it’s a really expensive mistake if you only consider your short-term. Property is the most expensive asset class for most AND the only asset class we live in. The combination of it being a lifestyle asset, [...]