Nobel Finance Sydney – Money Matters Newsfeed

Australia’s leading economists still expect a number of hikes before year end as the government seeks to keep inflation in check

THIS MONTH the RBA decided against lifting the cash rate but the question home owners are asking is for how long?

The latest inflation figures have shown that the Consumer Price Index (CPI) rose by 0.6 per cent in the June quarter, lifting the annual rate to 3.1 per cent ^-just outside the RBA’s target of 2 to 3 per cent.

In its monetary policy statement this month the RBA board said growth trend factors, coupled with close to target inflation and

an uncertain global outlook, influenced its decision to leave the cash rate unchanged for the third month running – good news for now.

What also bodes well for home owners is the slowing of house price growth and lower levels of lending activity – a clear indication that previous rate rises have taken effect.

RP Data senior research analyst Tim Lawless has welcomed the RBA’s decision to keep

rates on hold, saying the slowdown in market conditions has prompted the rate halt.

“Month-to-month capital gains in Australia’s capital city housing markets had been trending downwards since January and slipped into the negatives with a result of-0.7 per cent in June,” Mr Lawless said earlier this month.

“The slowdown in Australia’s capital city housing markets, together with a moderate CPI figure, which was below market expectations, would have been an important consideration by the RBA to keep rates on hold,” he said.

But while rates remain on hold for now economists warn that home buyers can expect to see further increases in the future.

AMP chief economist Shane Oliver said despite a similar prediction, the RBA still retains a clear tightening bias and will continue to keep inflation within target levels.

“The RBA will continue bearing down on the economy,” Mr Oliver said.

Mr Oliver added that high export prices coupled with improved business investment, consumer spending and solid employment recovery will see rates reach “near top” levels of 5.5 percent by end of 2011.

Tags: home loan, interest rates
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Australian banks could survive an economic contraction the size of the 1990s recession, the Australian Prudential Regulation Authority (APRA) has revealed. According to reports, APRA chairman John Laker ordered a stress test to be conducted to determine what would happen if there was a three? year deterioration in global economic conditions. The
Reserve Bank of Australia and New Zealand’s central bank also took part in the examination. Laker told The Australian Financial Review the results showed Australian banks had the capital resources to weather such a contraction. In fact, none of the 20 banks tested would have failed or even fallen below the minimum amount of top?rated assets on their balance sheets. However, he warned banks not to get complacent and take part in the high-risk activities that caused the economic downturn overseas.

Tags: australian banks safe
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By David Zwierecki 

Rebuilding or reestablishing your credit after a foreclosure is similar to trying to rebuild your credit after a bankruptcy. Actually, the majority of people who have a home foreclosed on them, also file bankruptcy as well so that they can truly try to get a new fresh start again. The steps that you will take to rebuild your credit will be one in the same whether you have had a home foreclosed upon and/or you have filed a bankruptcy.

The first and most important thing for you to do to re-establish your credit is to review a copy of your credit report. You can obtain a free copy of your credit report once per year from each of the 3 credit bureaus by visiting annualcreditreport and following the simple instructions. By reviewing your credit you can see what exactly is reporting in your credit report. It is important to see where you are at so that you have something to work with, you have a starting point and so you know what items need to be paid, what items need to be corrected and what items are not important. Correcting your credit report is of the utmost importance, especially after a bankruptcy. It is very important to make sure all accounts are reporting with 0 balances or that they were paid through the bankruptcy.  {continued}

(more…)

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by David Zwierecki
Building and Rebuilding your credit does not have to be nearly as hard as it sounds. In order to maximize your credit scores and build or improve your current credit you need to first understand how the credit scoring system works.

Here are some quick tips on improving your credit score that you can do all on your own:

# This is the most obvious of all of the tips but you need to start with making all of your payments on time. Make sure you pay your co-pays for insurance bills at the doctors office and/or hospital so that they do not eventually find themselves in the collections department and reporting as a blemish on your credit report. This is one of the most common types of collections that report to consumers credit reports.

# Never borrow over 50% of the maximum credit limit on your credit cards. It is even better if you can keep the balances under 30% of your maximum credit limits. Maxing out your credit cards, or even worse, going over your credit limit can have almost as negative affect on your credit report as late payments.

# Maintain a good balance of credit. For example 1 auto loan, 2 credit cards and 1 mortgage loan would be a good balance of credit. If you were to have 10 credit cards only and no other credit, this would not be a good balance/mixture of credit usage.

# Limit the number of total inquiries you have against you. This simply means do not apply for every type of credit that you can. Do not sign up for new credit cards at every sporting event or mall kiosk that you see so that you can get the free gift. Too many inquiries can have a negative impact on your credit score.

# Try piggybacking credit off of a friend or family member. This is a method of having a friend or family member add you one (or more) of their credit cards as an “AUTHORIZED USER,” not as a co-borrower and you can instantly gain their credit history from that credit card. Not all credit card companies will report this to your credit but many of them will. You must make sure the individual has a good payment history and is not over-extended on that credit card themselves for you to receive maximum benefits from this. Also a credit card with a long history will be much better for you to be added to.

If you are new to credit the easiest credit cards to obtain are usually department store credit cards, such as JCPenny, Sears, Kohl’s, etc… Also, Capital One and Household Bank are very easy to obtain credit cards through as well.

Therefore, just because you have credit cards does not mean you need to use them. Use them very sparingly and preferably only once in awhile to demonstrate a responsible payment history. Follow the tips above and the tips on the link above in order to improve or build your credit.

About the Author

The author of this article, Dave Zwierecki, has over 10 years of experience in the credit and mortgage lending fields. http://www.gofirstsecurity.com

Here is a great link on credit building/rebuilding and how credit scoring works: http://fshomeloan.com/index_files/mortgageblogger.htm

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by David Zwierecki
Which mortgage program is right for me? This is a very common question asked by many consumers. There is no one answer fits all type response that can be given. Each and every individual person has their own specific financial situation and their own financial goals and dreams. With the number of mortgage programs out there to choose from being in the hundreds and maybe even the thousands, this can be a difficult decision trying to figure out what is going to be best for you. There are interest only loans, ARM loans, Pay Option ARM loans, balloons, fixed rate loans, extendable balloons, conventional loans, FHA loans, and many, many others to consider. Therefore, so what do I need to think about when choosing a loan program then?

Some of the main factors that you will want to consider when choosing which mortgage loan is right for you are: how long will you live in your home, do you have any children attending college currently or within the next few years, is this a starter home, will you have a pre-payment penalty, are you expecting any new family members to be added to your family, how much do you have in liquid assets, are you self-employed or do you work for someone, how much longer until you plan on retiring, do you have enough money for retirement, do you have many other financial obligations besides a mortgage, do you own any other property, and many, many others. Answering these questions, or at least thinking about them before you are ready to finance a home mortgage loan can help to greatly improve your chances of finding the right mortgage loan to meet your demands.

A fixed rate mortgage is always going to provide the most stability in the long run, however since most Americans sell or refinance every 4.6 years a fixed rate does not always make the most sense. An ARM loan can provide a cheaper payment and a lower interest rate upfront for a certain number of years, but there is a lot more risk involved obtaining an ARM loan because of the uncertainty of what will happen after the fixed rate period expires on the ARM. Interest only loans are good for real estate investors and consumers who need the flexibility of being able to make only the interest portion of the monthly payments. Pay Option ARM loans can be a great way to maximize cash flow, especially for self-employed and commissioned borrowers. However, Pay Option ARM loans can incur negative amortization, which is when your balance increases instead of decreases. There are a lot of items that you need to make sure that you understand before entering into a Pay Option ARM loan. FHA loans are usually better for homebuyers, especially first time who may not have the best credit or the best overall financial situation.

Thus, find a good mortgage professional and keep him or her for the rest of your days. The more you work with one person the more familiar they will be with your situation and be able to understand where you are coming from and where you want to go. This will help to insure that you find the proper mortgage loan for your situation.

About the Author

The author of this article, Dave Zwierecki, has over 10 years of experience in the credit and mortgage lending fields.

http://www.gofirstsecurity.com http://www.nomoneydown123.com/Florida/mortgage_programs.htm

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