Good Morning and Welcome to Spring!
The weather of the last few days has certainly been a lovely change to being freezing.
Its unsurprising that Homebuilder is back in the news this week as the deadline looms for the 31st December cut off. Currently lenders are not allowing these as funds to complete, because of its uncertainty, with many brokers and aggregators wanting greater clarity. This is made especially difficult, because a client cannot get access to the grant without an exchanged building contract which you cant get without a formally approved loan.
So those clients who most need the grant are stymied from getting the grant unless they don’t actually need it. This is counter productive to the reason why the grant was put into action in the first place, let alone justifying the arguments that it was a grant for those who were already going to do it. I have noticed in discussion with clients, builders enticing clients with cheaper construction prices with them factoring in the $25k grant. This could be dangerous depending on how it is presented in the contract. Especially if builders are incentivising clients this way. It’s a reason as to why you need to check your build contract carefully. I’d hate to see this backfire like I have seen in the past where a build has the incentive amount reduced on their build cost.
In saying all of this, the ACT govt has had on their website the registration form available for some time SEE HERE, and now finally the application which needs to be filled out after the registration is complete SEE HERE. Likewise NSW has their application form up and running on the revenue website too SEE HERE. Hopefully with a push by the aggregators we can get lenders to finally accept this as funds to complete.
Good friends of mine who are Financial Planners wrote a great article this week about how the world of investing was changing especially with the way the world is currently SEE HERE
The FBAA had called out some lenders this week too around their farcical behaviour still sending out loan documents in the mail. I agree with them completely! The ridiculousness of these kinds of policies have been a major source of clients frustration especially when a banks policy requires ‘wet’ signatures. In recent weeks this requirement to have ‘wet’ signatures coupled with another stupid policy of not being able to settle on scanned copies, even when the originals are in a tracked express post envelope have caused several clients to be delayed in settlement.
Most of these cases have been lucky enough to have an understanding vendor who didn’t push for penalties. However not everyone has been lucky. In order to get a bank to pay for the interest charges or late settlement fee’s there is another whole paper-bound process that clients often feel it’s all too hard. Which I think some lenders rely on so they don’t have to pay.
No major changes in the rates this week by way of fixed or variable. They might all be waiting to see what the RBA does today, which I would be very surprised if they did anything.
I hope you all have a smashing week out there. Let me know if you need help with any scenarios or property reports.
JC
Scenarios and interest rates quoted above are suggestions and constitute general advice only.
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