Home Loan Health Check

2 Dec 2019

As part of a growing menu of Teal Assist services, Brad Teal Real Estate is pleased to announce its newly formed partnership with BCP Finance, offering our clients access to independent finance solutions.  BCP Finance was founded by Brett Hartwig in 1995.  Brett has over 40 years of banking and finance experience and has grown BCP Finance to be an integrated arranger of Residential, Commercial and Corporate financing solutions.  Keep reading to learn more about the excellent finance insight the team at BCP can offer.

Why now could be the perfect time to get a free home loan health check
It’s common for homeowners and investors to wonder if their current mortgage offers them the best value for their financial circumstances.  While a home loan health-check might seem like a menial job that is easiest filed in the ‘too hard basket,’ every month that goes by could be costing you hundreds of dollars in unnecessary interest repayments or fees.  That’s why we have compiled a list on the best times in your life to review the health of your loans.

The 11 best times in your life to ask for a loan health-check

  1. Two years after you have purchased a home or investment property
    A lot can happen in two years; personal circumstances change, variable interest rates increase, and fixed rates can become uncompetitive. That’s why, whatever point of life you’re at, we recommend you get your home loan checked at least every two years to ensure they are optimised towards your present and desired future financial position.
  2. If you think your lender’s rate is no longer competitive
    Variable interest rates can be driven up by lenders as they increase their exposure levels to the debt market. Consequentially, lenders can go from being the most competitive to significantly less so as their desire to write new business diminishes.Additionally, while a lender’s variable rate might still be competitive, their fixed rates could potentially be out of the market. As such, if a borrower is looking to lock into a competitive fixed-rate contract, they might need to consider moving lenders.
  3. When you get nervous every time you look at the interest charges on your credit card or personal loan statements
    Debt consolidation can assist borrowers in reducing their overall monthly debt commitments.Personal loans and unsecured debt (Credit Cards) are costly, and always include the payment of the principal portion of the debt.Reviewing your loan agreement can consolidate these commitments into a singular debt facility, (secured) providing borrowers with the benefit of reduced monthly repayments.  
  1. After a salary rise or three months after you have started a new job
    Beginning a new job or receiving a salary increase can significantly increase your borrowing capacity and financial freedoms. This is a great time to review your home loan as additional income reduces credit risk and barriers to loan approval. 
  1. If you are thinking about expanding your family
    Borrowing capacity is based on income and expenditure. As such, additional dependents within the family will reduce borrowing capacity. That is, a person with the same income and two dependents can borrow less than a family with only one dependent. Getting your mortgage set before you increase the number of household dependents will provide a larger borrowing capacity than if done so afterwards. 
  1. If you are considering investing in shares or a property
    Purchasing investments can significantly impact your financial situation as it allows for personal asset growth to occur. Asset acquisition can also have a positive taxation impact, particularly if the loan is established through an interest-only structure.  
  1. After receiving an inheritance
    Receiving an inheritance from a loved one can also provide numerous positive benefits, including increased access to funds and a reduction in mortgage repayments as a consequence of additional income.
  1. If you want to renovate your home or investment property
    Renovating has many benefits, including added emotional enjoyment and an eventual increase in house value. However, renovations should be carefully considered, as they often carry substantial funding costs to execute that can impede on outstanding mortgage repayments.
  1. When you’re considering retiring or when you are about become an empty nester
    Becoming a retiree or empty nester often means downsizing for many parents. This reduction in house size and tenants results in reduced costs needed to run the residence – food, electrical, gas, water etc. Ultimately, leading to an increase in disposable income and long-term mortgage reduction.
  1. If your living arrangements have recently changed or are about to change
    Undertaking new living arrangements with a de-facto, partner or spouse is a great time to review your home loan, as there are now shared costs, additional wages and disposable income to support mortgage repayments.
  1. When you are facing a marriage or relationship break-up
    A marriage or relationship breakdown can often place strain on financial circumstances, especially if living arrangements were previously shared. Break-ups usually mean mortgage repayments increase due to the removal of a second wage or consequential spouse payout. Household operating costs can also increase, placing additional stress on financial flexibility. 

 Think you might need a home loan health check?
You’ve got nothing to lose.  If your loan structure/s are already ideal for your circumstances, we’ll tell you.  If not, we’ll suggest how you can optimise your finances to suit your current needs and future plans.

Call BCP Finance on 9347 4154 and mention Brad Teal for a FREE, no obligation loan health check.


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