Macquarie Real Estate is a local real estate agent located in Casula, near Liverpool NSW. Yesterday its principal, Joe Romeo, informed me of the following offer he’s making.
Any property listed with his agency before 30 June 2011 that results from a referral from such as what I’m doing here in this blog, when that property is sold (even if it’s after 30 June 2011) he’ll donate 20% of his commission to a charity nominated by us. You need to mention to them how you heard about the offer when you sign up.
If you take up this offer, sell the property through them, and mention you heard about it here, I’d be more than happy to discuss with you and come to an agreement about a worthwhile charity you’d like me to direct to have Joe’s donation sent to.
What’s the catch? Apart from the agent getting a listing (and most sellers list the property they’re selling with an agent anyway) there isn’t one! I don’t receive any payment, gift, commission or special favour (and I never have). There’s no condition about which solicitor you use either.
Have a think about it. Better still, if you’d like to ask me about Joe and his team, give me a call.
12 May, 2011
10 May, 2011
Lender’s mortgage insurance premiums - One way to “make” some money back!
While the typical average Australian home loan term is around 25 to 30 years, the average length of a home loan is reported to be 5 years, some say even as low as 3½ years. If these figures are averages, there must be many loans that are discharged much sooner. In my experience, it’s becoming rarer for a home buyer to live in the one home for lengthy period of 20 years or more. Australians buy and sell their homes for a variety of reasons: to improve their lot; so called sea changes and tree changes; moving to where the jobs are; moving out when jobs are gone….
So, the issue is, while home loans are typically designed for the long term, most often borrowers barely last the distance. Many borrowers are also required to pay their lender’s mortgage insurance premiums. This insurance covers the lender, not the borrower, but it’s the borrower who pays the insurance bill. I’ve seen such premiums as high as $18,000, but typically are around the $4,000 to $8,000 mark.
The premiums are a once only payment, providing cover for the term of the loan… remember, terms that are assumed to be for 20 to 30 years! But many of these loans are discharged within 5 years.
So, what happens for that part of the premium covering the term of the loan that’s no longer there? Nothing, unless you do something about it!
Have you ever sold a car and then obtained a part refund of your insurance premium when you cancelled your insurance cover? It’s a comparable situation.
Many lenders don’t tell you, but in most cases you can do something similar regarding lender’s mortgage insurance premiums you’ve paid if you pay off your home loan early. The earlier it’s paid off (for example, you’ve sold the property) the greater the chance of a significant refund of part of the previously paid premium.
The refund amount varies, and many factors can affect it. For example, whether the borrower has defaulted, how many (or how few) years of the loan have passed, but it can be up to 40 to 50% of the original premium!
It’s the mortgage insurer that ought to be approached, rather than the lender, but if you’re about to borrow and a lender’s mortgage insurance premium is payable, it would be very prudent to clarify with your lender their policy on refunding mortgage insurance premiums. Be prepared to be firm and press for an answer. Many lender’s staff and some brokers aren’t even aware of this, so they may need encouraging to find out more for you.
So, the issue is, while home loans are typically designed for the long term, most often borrowers barely last the distance. Many borrowers are also required to pay their lender’s mortgage insurance premiums. This insurance covers the lender, not the borrower, but it’s the borrower who pays the insurance bill. I’ve seen such premiums as high as $18,000, but typically are around the $4,000 to $8,000 mark.
The premiums are a once only payment, providing cover for the term of the loan… remember, terms that are assumed to be for 20 to 30 years! But many of these loans are discharged within 5 years.
So, what happens for that part of the premium covering the term of the loan that’s no longer there? Nothing, unless you do something about it!
Have you ever sold a car and then obtained a part refund of your insurance premium when you cancelled your insurance cover? It’s a comparable situation.
Many lenders don’t tell you, but in most cases you can do something similar regarding lender’s mortgage insurance premiums you’ve paid if you pay off your home loan early. The earlier it’s paid off (for example, you’ve sold the property) the greater the chance of a significant refund of part of the previously paid premium.
The refund amount varies, and many factors can affect it. For example, whether the borrower has defaulted, how many (or how few) years of the loan have passed, but it can be up to 40 to 50% of the original premium!
It’s the mortgage insurer that ought to be approached, rather than the lender, but if you’re about to borrow and a lender’s mortgage insurance premium is payable, it would be very prudent to clarify with your lender their policy on refunding mortgage insurance premiums. Be prepared to be firm and press for an answer. Many lender’s staff and some brokers aren’t even aware of this, so they may need encouraging to find out more for you.
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