Finance Tips Archives | AXTON Finance

Understanding How do Mortgage Brokers Get Paid: No Extra Cost, Just Extra Value

Posted on 08/11/202402/12/2024 by Rix Almonicar

When navigating the complex world of home loans, Australian borrowers have increasingly turned to licensed mortgage brokers for expert guidance. As of the publication of this blog, Australian mortgage brokers write approximately 70% of all home and investment loans (Source: Mortgage & Finance Association of Australia MFAA Media Release September 9th 2024).

One common question that often arises is: How are mortgage brokers paid? This blog article aims to clarify how brokers are paid and why using a mortgage broker generally incurs no extra cost for borrowers while providing substantial advantages.

How Mortgage Brokers Are Paid in Australia

In Australia, accredited mortgage brokers receive remuneration through commissions paid by banks and lenders. Typically, brokers earn an “upfront commission” for facilitating a new loan, followed by an ongoing “trail commission” as long as the client retains their loan with the lender. The important thing to note is that these commissions come directly from the bank or lender, meaning there is generally no out-of-pocket expense for clients using a broker’s services. These lender payments are part of their customer acquisition costs—a cost they would also incur if you went directly to them through their internal sales channels.

In most cases, borrowers pay no fee for the professional services of a mortgage broker. It’s also worth mentioning that reputable brokers are legislated to provide transparency and will always disclose how they are paid, ensuring clients have a full understanding of any arrangements in place.

The Benefits of Using a Mortgage Broker

While there is usually no additional cost in using a broker compared to approaching a lender directly, there are many advantages that make brokers a preferred choice for many Australian borrowers.

Acting in Your Best Interests

Australian mortgage brokers are legally required to operate under the “Best Interests Duty” introduced in 2021. Unlike bank representatives, who are naturally inclined to promote their bank’s own products, brokers are required to work for you. They provide advice, not just a product, taking into account your individual needs and financial circumstances to recommend the most suitable loan options from a range of lenders. This approach ensures that the focus is on finding a solution that works best for your unique situation.

Expertise Across Multiple Lenders

Mortgage brokers have access to a broad panel of lenders, from the Big Four banks to smaller banks, credit unions and non-bank lenders. This wide access allows brokers to provide clients with a comprehensive selection of mortgage options. Each lender has its own rules, policies, and lending criteria, and an experienced mortgage broker understands these intricacies inside and out. By having this knowledge at their fingertips, brokers can match borrowers to the right lender, taking the guesswork and hassle out of the process.

Whether it’s navigating a complex employment structure, securing a higher loan-to-value ratio (LVR) without mortgage insurance for those working in specialist industries like doctors, medicos, engineers and lawyers, or understanding how specific lenders assess borrowing capacity, brokers can make the process smoother and ensure a higher chance of approval.

Tailored Guidance Throughout the Process

Buying or refinancing a home or investment property is often one of the biggest financial decisions in your life, and the associated paperwork can be daunting. Licensed mortgage brokers simplify this journey by managing the application process end-to-end, ensuring your paperwork is correct and submitted on time. Moreover, brokers maintain open lines of communication throughout, giving clients peace of mind and helping them understand their options, even if situations or rates change.

Using a mortgage broker means you are getting tailored, personal guidance—rather than a one-size-fits-all sales pitch—and can save time, reduce stress, and ultimately secure a better home loan outcome.

Why Using a Mortgage Broker Is Smart and Cost-Effective

Since banks essentially pay for the origination services that brokers provide, clients benefit from professional, industry-leading advice without paying more. The value mortgage brokers deliver is not just about finding the cheapest rate but involves building a strategy that considers your goals—whether it’s buying your first home, investing, or refinancing.

Mortgage brokers, like those at AXTON Finance, also work to negotiate better rates and terms on your behalf. Because brokers send significant business to lenders, they often have negotiating power that individual clients might not. This means they can advocate for discounts and benefits that may not be available when approaching a lender directly.

The Added Benefit of Long-Term Service

One of the most significant advantages of working with a mortgage broker is the ongoing relationship that extends well beyond the initial loan setup. At AXTON Finance, our brokers are committed to re-pricing and retention to ensure that the interest rate you receive not only starts great but remains competitive throughout the life of your loan. This proactive service is something you are unlikely to receive as a direct bank customer. Imagine walking into a bank today to secure a rate, and then in 12 months’ time, that banker knows there’s a better rate available—but it’s unlikely they will reach out to inform you or suggest refinancing to another lender without your initiation.

At AXTON Finance, we focus on creating these types of lasting relationships rather than transactional ones, which is why most of our clients come to us through referrals and continue to work with us for years. We not only help our clients in the first instance but on an ongoing basis, supporting them, their friends, and their family members as their needs evolve. Given our long-standing experience, we pride ourselves on providing clients with exceptional, continuous service to ensure they always have the best mortgage solution for their needs.

Ready to Get Started?

If you’re considering buying a home, refinancing, or simply looking for professional mortgage advice, get in touch with the award-winning team at AXTON Finance. Our experienced brokers are here to guide you every step of the way, offering personalised service and ensuring your best interests are always our priority.

Connect with one of our highly experienced brokers today at AXTON Finance and discover why hundreds of satisfied clients continue to choose us for their mortgage broking needs.

Are You Paying the Bank Loyalty Tax?

Posted on 14/10/202421/10/2024 by Rix Almonicar

When was the last time you checked if your home loan is still the best deal out there? If it’s been a while, there’s a good chance you’re paying the “bank loyalty tax” — that hidden cost of sticking with your lender without questioning if they’re still giving you the best rate. Let’s break down why this happens and how Axton Finance helps you avoid this costly mistake.

What is the Bank Loyalty Tax?

The “bank loyalty tax” refers to the higher interest rates that loyal customers often end up paying simply because they haven’t refinanced or challenged their lender for a better rate. Banks and lenders often reserve their most competitive deals for new customers, enticing them with lower rates while you, as an existing customer, are left paying more. It’s frustrating but true: loyalty doesn’t always pay in the world of home loans.

New Deals for New Customers

Many lenders offer their best rates and incentives to attract new customers. As a result, you, who have been faithfully paying your mortgage, may be left on higher rates that were competitive at the time of signing but no longer reflect the best value available today. Staying with your current lender without regularly reviewing your rate could mean you’re missing out on significant savings.

Axton Finance: Keeping Your Deal Great

At Axton Finance, we believe you deserve the best deals — not just when your loan settles, but for the entire life of the loan. That’s why we conduct yearly loan reviews for you, proactively working with lenders to secure rate reductions and better terms. We use cutting-edge fintech software to automatically monitor your loan rate, ensuring it remains competitive. Imagine getting a call or SMS from us letting you know that we’ve successfully negotiated a better rate for you, without you lifting a finger. That’s the kind of service we provide.

Time for a Change? We’re Ready to Help

If your lender won’t play ball and refuses to adjust your rate, despite your loyalty, we won’t leave you hanging. We’ll use our industry expertise and powerful technology to explore the best options available across the market. If refinancing makes financial sense, we’ll make the process seamless, ensuring you benefit from the best possible deal. The days of being “too busy” to act on your mortgage rate are over — with Axton Finance, we do the work for you.

Let’s Make Sure You’re Not Paying the Loyalty Tax

Don’t let inaction or loyalty cost you thousands of dollars over the years. Book a time with us today for a no-obligation review of your home loan. We’ll help you determine if your lender is still giving you the best deal or if it’s time for a change.

Call us at our office, contact us here or schedule a free consultation to start the conversation. We’re here to make sure your mortgage stays in top shape, so you can stay focused on your goals, not your rate.

Unlocking Exclusive Mortgage Benefits for Doctors, Lawyers, Accountants & Emerging Wealth / High-Net-Worth Professionals

Posted on 04/07/202414/07/2024 by Nick

At AXTON Finance, we specialise in crafting tailored mortgage broking solutions for high-net-worth and emerging wealth professionals, including doctors, surgeons, medical specialists, lawyers, judges, accountants (both CA and CPA accountants) and certain industry specialists.

Besides having over 300 five-star Google reviews you can consider us like your private bankers who know a lot more about lending than just one bank. You will have direct access to your experienced mortgage broker, who will usually have at least 10+ years of industry experience to manage your ongoing client relationship – we aim for this not to be a once-off transaction with you (you will not find any inexperienced rookies at AXTON Finance)

Why do professionals choose AXTON Finance?

LMI Waivers for $500K up to $10m+ mortgages

Lenders’ Mortgage Insurance (LMI) can represent a significant expense or an outright blocker when purchasing a new home or investment property. However, certain professionals—broadly speaking, doctors, lawyers, accountants, and even individuals buying luxury homes in bluechip-defined postcodes—can qualify for LMI waivers on loans up to 90-95% of a property’s value without the additional eye-watering LMI costs. This can result in substantial savings exceeding tens of thousands of dollars, particularly for properties valued in the multi-million-dollar range.

Who can access Lenders’ Mortgage Insurance Waivers?
- Doctors, surgeons and selected medical professionals* (must be registered Australian Health Practitioner Regulation Agency (AHPRA))
- Accounting Tax and finance professional^
- Lawyers, Solicitors, Barristers, Judges, and other Judicial and legal professionals
- Engineering/IT professionals
- Veterinarians
- Buyers of luxury high-end properties in limited bluechip metropolitan suburbs
Tailored Solutions That Understand Your Needs

Our licensed mortgage brokers at AXTON Finance are adept at more than just securing loans. They understand the intricacies of your profession and are equipped to offer tailored advice that aligns with your long-term property aspirations. Whether it’s negotiating better terms or exploring unique lending avenues, we ensure your mortgage supports your broader financial landscape.
Stability and Expertise

Unlike transient bank staff and call centre ‘brokers,’ our professional brokers have a deep-rooted understanding of the mortgage industry’s ever-changing lending policies, rules, and products. Our team’s extensive experience ensures that your mortgage lending decisions are grounded in expert knowledge and lived experience.
Seamless and Efficient Processes

We streamline the mortgage process to leverage digital efficiencies, but we maximise the personal touch (no offshore call centres here at AXTON), making it as efficient and hassle-free as possible. From initial consultation to final approval and beyond settlement, our team works diligently to ensure a smooth approval process, allowing you to focus more on your professional and personal life without worrying about the status of your mortgage approval. Because we live and breathe mortgage approvals we get you to ‘approved’ sooner.

The AXTON Advantage

Investing in a service that offers more than just basic loan facilitation is crucial. At AXTON Finance, you’ll benefit from:

Expert Insights: Access to experienced mortgage brokers who specialise in specialist income and high-net-worth lending.
Exclusive Offers: Opportunities to save on LMI and gain access to competitive interest rates not available to the general public.
Long-Term Support: Ongoing advice and support as your lending needs evolve over time.

Choosing AXTON means you have chosen a team that prioritises your lending needs. We don’t just pitch a product; we build client relationships that last. Let us help you navigate your mortgage options to find the best possible solution that complements your affluent lifestyle and high standards.

Call us today for an obligation-free discussion. If you have to leave a message, we will get back to you within five minutes.

^*Full list of approved medico specialists are (but not completely limited to) Anaesthetist, Cardiothoracic Surgeon, Clinical Pharmacologist, Cosmetic Surgeon, Dentist, Dermatologist, Ear and Throat Surgeon, Emergency Surgeon, Endocrinologist, Gastrointestinal Surgeon, Gastroenterologist, General Practitioner (also known as a GP or Medical Practitioner), Gynaecologist, Haematologist, Hepatologist, Immunologist, Nephrologist, Neurosurgeon, Neurologist, Obstetrician, Oncologist, Ophthalmologist, Optometrist, Oral and Maxillofacial Surgeon, Orthopaedic Consultant, Orthodontist, Otolaryngologist, Paediatric Surgeon (Neonatal and Perinatal), Pathologist, Physiotherapist, Plastic Surgeon, Podiatrist, Psychiatrist, Radiologist (Note: this usually does not include Radiographers – call us to confirm), Reconstructive Surgeon, Respiratory or Thoracic Surgeon, Urologist, Vascular Surgeon.

^{^}Accountant, Actuary, Auditor, Chief Financial Officer CFO, Director, Finance Director, Finance Manager, Financial Controller, Partner. Minor variations to these titles, such as ‘Tax Accountant’ or ‘Internal Auditor’, are also acceptable. Most lenders usually require CA (Chartered Accountant) or CPA (Certified Public Accountant) registration.

Can you borrow money for an investment property under a company name?

Posted on 24/06/202424/06/2024 by Nick

At AXTON Finance, we are well-versed in the intricacies of property investment through a company structure. This investment approach, while potentially beneficial in terms of asset protection, tax management, and credit policy assessment, requires a thorough understanding of the specific lending criteria that apply to corporate entities. Our team, with its specialized knowledge and experience, is adept at facilitating these unique transactions, ensuring you secure approval with terms tailored to your investment goals.

Investors considering this route can access up to 95% financing for conventional investment properties or 80% for company low doc (reduced documentation) loans, with commercial properties evaluated individually but usually at slightly lower LVRs (loan to valuation ratios) again. Each lender has distinct policies and loan limits, making our expert guidance crucial.

Investing in property through a company structure presents unique challenges. Not all banks are equipped to handle loans under company names, due to specific processing requirements or policy gaps in their teams. These challenges may include restrictions on professional package discounts or the use of additional financial products like offset accounts and credit cards under a company name. Some lenders may even require all shareholders to guarantee the loan. This underscores the importance of selecting the right lender—one that combines competitive rates with the capability to manage corporate structures effectively. Our team at AXTON Finance is well-versed in these challenges and can guide you through the process.

For instance, if John and Jane Smith, directors of ABC Pty Ltd, decide to purchase an investment property, the setup would typically involve ABC Pty Ltd both as the borrower and property owner, with John and Jane as the guarantors.

Furthermore, companies acting as corporate trustees for trusts have specific borrowing capacities and structures, which our team can also manage by ensuring all legal documentation, like company constitutions and trust deeds, meet target lender requirements.

It’s important to understand that directors might still be liable if a company fails to meet its loan obligations. Banks often require personal guarantees from directors, especially if the company is a shell business or SPV (Special Purpose Vehicle) that does not earn significant income or has been set up solely for the purpose of purchasing the property. This underscores the importance of expert guidance when structuring company loans. At AXTON Finance, we can help you navigate these potential risks and responsibilities.

Any time that you may be considering a loan in a company name you must seek qualified accounting and legal advice to ensure the appropriateness of the proposed structure and that no unintended consequences occur.

At AXTON Finance, we pride ourselves on our expertise in setting up and managing home loans for companies, from simple setups with a couple of directors to more complex joint ventures utilising unit or discretionary trusts. Our extensive experience and deep understanding of lender criteria allow us to identify the best possible rates and terms for your situation.

To explore how we can assist you with your company property investment or to get a tailored assessment, contact us today. Our specialists are ready to provide you with the personalised advice and support you need to navigate this complex area efficiently.

Which Banks Offer Multi Offset Home Loans

Posted on 22/05/202427/05/2024 by Nick

What are the Benefits of Multiple Offset Accounts

Unlock the potential of your home loan by utilizing multiple offset accounts. This guide highlights how strategically using multiple offset accounts can enhance your financial control, save money, and accelerate the elimination of your mortgage.

What is a Multiple Offset Account loan

An offset account is a banking account linked to your home loan that reduces the balance on which interest is calculated. Most lenders only allow you to have one offset account per mortgage account which is great but does limit the control of your finances. By using a lender who offers multiple offset accounts, you can strategically distribute your funds, gaining flexibility and enhanced effectiveness over your finances.

Banks & Lenders Offering Multiple Offset Accounts

Several major Australian banks and lenders offer this functionality, providing borrowers with additional flexibility in managing their finances. Notable banks include Macquarie Bank with its comprehensive Offset Home Loan package (enables up to ten FREE 100% multiple offset accounts).

Other key providers of multi-offset account structures include;

– Commonwealth Bank
– Macquarie Bank
– Resimac Home Loans
– uBank
– AMP Bank
– Newcastle Permanent
– ME Bank
– Suncorp Bank
– St George Bank
– Great Southern Bank
– Quodos Bank
– BankWest
– Beyond Bank Australia
– Bank Australia

It’s essential to explore each bank’s specific features to find the best option for your financial needs as not all multiple offset account structures work exactly the same.

Benefits of having Multiple Offset Accounts

Offset accounts act like financial boxes, allowing you to allocate funds according to your needs—such as one account for daily expenses and another for significant purchases or investments. This setup helps you manage your cash flow effectively and monitor your spending.

Tips on Maximizing Offset Account Benefits

The more funds you maintain in your combined multi offset accounts, the less interest you pay on your mortgage. Depositing large or small sums of money not required for use into an offset account can significantly decrease interest charges over the medium to long term given the incredibly powerful effects of compounding interest.

The Mechanics of Offset Accounts

An offset account directly reduces the interest payable on your home loan by offsetting your loan balance with the account balance. This structure is especially beneficial for joint home loan holders, allowing individual financial management while benefiting from the shared reduction in home loan interest.

Enhancing Financial Security Through Offset Accounts

Multiple offset accounts can offer additional financial security. When unforeseen expenses or changes in your financial situation happen (and we all know they do!), these funds have been put into an offset account that you might nickname the ‘Mojo account’ (as the Barefoot Investor, Scott Pape, famously called such an account) can cover costs without resorting to high-interest credit options, or worse still not having any funds at all. This of course helps give you longer-term peace of mind and helps to improve your financial stability.

By understanding and implementing a multiple offset account structure effectively, you can create a more efficient way to take control of your mortgage, making your money work harder for you and moving you closer to owning your home outright.

While multiple offset accounts can offer significant benefits in the right scenario, they may not be suitable for everyone. Consult with a professional mortgage broker, like AXTON Finance to tailor the loan structure to your unique financial situation and goals. Book your 15 minute discovery meeting here.

How to minimise your mortgage with an Interest Free Credit Card and an Offset Home Loan

Posted on 13/05/202413/05/2024 by Nick

Offset accounts can significantly enhance the financial benefits of a mortgage loan, especially when used in tandem with simple tools like an interest-free credit card. This article explores how coupling offset accounts with the clever use of interest-free credit cards can create a powerful saving strategy, particularly for those with substantial mortgage balances and good household incomes.

Understanding Offset Accounts

An offset account is a bank account linked directly to your mortgage that has the usual functionality of an everyday account such as being able to have a debit card, Apple/Android Pay, branch withdrawals and deposits etc. The money held in this account is offset daily against the mortgage balance, and interest is charged only on the net balance. It is important to note that the offset account itself does not earn interest – it offsets it’s balance against your home loan. For instance, if you have a mortgage of $1,000,000 and an offset account balance of $50,000, you will only be charged interest on $950,000. This setup can lead to significant interest savings over time, reduce the term of your mortgage, and increase your equity. Offset accounts are particularly beneficial as they provide flexibility in accessing funds, unlike direct repayments into the mortgage which may be less frequent and require a higher level of discipline to action each month.

Multiple Offset Accounts

There are a handful of banks and lenders who offer multiple offset account structures that enable you to aggregate the combined account balances against a single mortgage account. This is great if you like better financial control and have funds put aside for large bills, your children’s education costs, taxation provisions, savings for a holiday or any other purpose you can really think of. Multiple offset account structures are a great tool for both saving on interest and maintaining purpospeful liquidity for day-to-day needs.

The Role of Interest-Free Credit Cards in Financial Management

Interest-free credit cards have been around for a long time now and of course offer a period during which no interest is charged on purchases, typically ranging from 30-55 days. When used wisely, these cards can manage cash flow without incurring extra costs, thus allowing any spare cash to sit in your offset account for as long as possible, further reducing the mortgage balance subject to interest. The key to maximizing the benefit from interest-free credit cards lies in responsible spending and consistent repayment within the interest-free period. This ensures that all your available cash can remain in the offset account, working to decrease your mortgage interest obligations, without accruing additional debt from credit card use.

Using Offset Accounts with Interest-Free Credit Cards

Utilizing both an offset account and an interest-free credit card together can significantly amplify your savings. Here’s how to synchronize these financial tools effectively:

Direct Income into an Offset Account: Route all of your income directly into your offset account. This increases your average daily balance, which reduces the interest on your mortgage each month – this can have a powerful compounding effect over time.
Use Credit Card for Expenses: Use your interest-free credit card for daily expenses. This approach keeps more money in your offset account for a longer period during the month, maximizing the interest savings on your mortgage. There is of course the added benefit that many credit card companies offer customers frequent flyer points affiliated with the major Australian Airlines Qantas and Virgin – you may be surprised at how quickly you will rack up those frequent flyer points for your next trip!
Pay Off Credit Card From your Offset Account: Before the end of the interest-free period on your credit card (typically 30-55 days), pay the balance using the funds from your offset account. This method ensures you avoid interest charges on your credit card while keeping your offset account balance high throughout the month. Many credit card companies enable you to have an automatic sweep of the monthly balance due to automate and streamline the efficiency of paying the card bill on the very last day its due. This maximizes the benefit of the money in your control and minimizes the manual effort required to administer the money smart procedure.

Case Study: $1,000,000 Mortgage with an Offset Account

Consider a hypothetical scenario: a homeowner with a $1,000,000 mortgage at a 6.0% annual interest rate over a 30-year term. Suppose this homeowner maintains an average of $50,000 in their offset account and spends $3,000 monthly using an interest-free credit card, which they pay off at the end of each month from the offset account.

Calculation: Without the offset account, the monthly interest would be calculated as $5,000 initially ($1,000,000 x 6% / 12 months). With $50,000 in the offset account, the interest reduces to about $4,750 monthly ($950,000 x 6% / 12 months), saving $250 per month or $3,000 annually. Over the life of the loan, this strategy alone could save approximately $90,000 in interest.

So as you can see having a basic understanding of how offset accounts work and how they can help save your thousands in interest. Not all offsets are created equaly though as many lenders limit customers to only one offset (not multiple) or ‘partial offset’ arrangements rather than 100% offset so it pays to get qualified advice.

Offset home loans are typically marginally more expensive because of a slight loading on the interest rate charged or the fees payable so if you have limited monthly cashflows there maybe diminishing returns for having an offset account. Some loans in certain entities like trusts or companies or for expat / overseas borrowers are not always allowed to have offset accounts linked.

Overall offset home loans are a fantastic feature that may be able to help you pay off your loan sooner. Why not book a time with us today to discuss your needs and to determine if an offset home loan is suitable for you. We have over 30 major banks and non bank lenders that we can compare for you today.

Unlock Financial Security in Retirement with a Reverse Mortgage

Posted on 24/04/202424/04/2024 by Nick

As Australians enter their senior years, achieving financial security becomes increasingly critical. Unfortunately, even well-laid plans can falter, leaving many retirees facing stress and anxiety about their financial futures, especially as living costs continue to rise.

At AXTON Finance, we often encounter adult children concerned about their parents’ financial well-being. They turn to us for professional mortgage brokering advice to explore options for assisting their parents, including ways to unlock equity from their homes.

While some adult children are in a position to provide financial support, this isn’t always a viable long-term solution. It can also lead to uncomfortable feelings of dependency for parents, potentially exacerbating their stress.

A growing number of seniors and retirees are now considering a Reverse Mortgage as a viable solution. This straightforward financial tool can, subject to eligibility, provide a lump sum to release home equity as cash, settle existing debts, or fund home improvements. This enables seniors to comfortably remain in their own homes longer. Importantly, a Reverse Mortgage does not require income assessment and offers options for periodic monthly payments to supplement the retiree’s income.

There are no mandatory repayments with a Reverse Mortgage until the home is sold, and voluntary repayments can be made at any time, whether in regular installments or as a lump sum.

Like any significant financial decision, consulting with a solicitor or financial planner is crucial before proceeding with a Reverse Mortgage. Most plans include a “No Negative Equity” guarantee, ensuring that borrowers will not be forced to sell their homes unexpectedly.

Pensioners considering a Reverse Mortgage should also consult with Centrelink to ensure that their benefits remain unaffected. In most cases, this type of income does not impact pension entitlements, as it is derived from an owner-occupied residence rather than employment or investment income.

At AXTON Finance, we are dedicated to finding solutions that enhance the quality of life for our clients. In today’s economic climate, it might be time for your home to start working for you. If you’re considering a Reverse Mortgage or need more information about how it might benefit your situation, please contact us at AXTON Finance. Let us help you secure a more comfortable and stable financial future.

Why Choose a Broker Over Going Direct to a Bank?

Posted on 24/04/2024 by Nick

Navigating the Australian mortgage market can be daunting, especially when it comes to securing the best mortgage options that are suited to your specific needs. While going directly to a bank might seem straightforward, it often isn’t the most beneficial route. Here’s why choosing AXTON Finance can be a smarter decision: With over 300+ five-star Google reviews we offer a personalized service tailored to your needs, access to a wide range of mortgage options from multiple leading lenders, expert guidance for complex needs, and leverage to secure competitive rates and favourable terms. These are the benefits you won’t get by going directly to a bank.

Designed for Time-Poor Professionals

At AXTON Finance, we specialize in helping time-poor professionals who are looking to secure larger loan approvals that usually involve more complex requirements. Our expertise and personalized service ensure that your financial needs are met with efficiency and precision, saving you valuable time and effort. We are here to guide you through the complex mortgage process and provide you with the best possible solutions.

Personalized Service Tailored to Your Needs

AXTON Finance provides an efficient bespoke banking experience tailored uniquely to your financial needs. Going direct to a bank is like going to a car dealership and asking what’s the best car on the market today – you are being sold a product, not a service.

Unlike banks, which often have rigid criteria and impersonal service, and a revolving door of staff AXTON takes the time to understand your specific circumstances, offering reliable solutions that direct to bank options simply cannot match.

Expert Guidance for Complex Needs

The mortgage process is fraught with complex terms and conditions that can be overwhelming without expert guidance. AXTON Finance’s team of highly experienced professionals simplifies these complexities and provides talented advice, ensuring you make informed decisions and avoid the common pitfalls that could waste your time and money.

A Wide Range of Mortgage Options from Multiple Leading Lenders

Did you know that going directly to a bank means there is no obligation for them to offer you products that are truly in your best interests? Licensed mortgage brokers are legislated to always operate within your best interests and provide you with a detailed summary as to why certain structures and products meet your needs first and not the banks. Direct bank customers are limited to the products that their bank offers. AXTON Finance, however, gives you access to a wide array of mortgage products from over 30 major banks and lenders. This diversity ensures you’re not just getting a loan but the best advice coupled with a loan for your particular financial situation.

Leveraging Opportunities

Settling for your current bank’s offer could mean missing out on better rates and more suitable mortgage products. AXTON Finance leverages industry expertise and relationships to secure competitive rates and favourable terms, often not advertised directly by lenders. With AXTON, you gain an edge in financial arrangements that a direct bank approach usually cannot provide.

Don’t Miss Out on better Financial Solutions

Imagine securing not just any loan, but the best possible loan for your situation. We ensure you have access to bespoke solutions and a team that champions your financial success. Why limit yourself to the offerings of a single bank when we can open the door to a world of possibilities and a better financial future?

Further, we ensure your loan remains competitive well past the settlement date, meaning we complete automated annual reviews that compare the market and needle your existing lender to ensure you get a great rate today and tomorrow. Ask yourself—would your current bank tell you that you could get a better rate next year?

At Axton Finance we create relationships, not transactions.

Call us today or book an obligation-free mortgage strategy meeting to find out why thousands of busy professionals have appointed Axton Finance as their trusted mortgage brokers.

How to Refinance Your Home Loan for a Better Deal

Posted on 18/04/202403/05/2024 by Nick

Unlocking New Opportunities: Why and How to Refinance Your Home Loan

Refinancing your home loan can seem like navigating through a maze of rates and terms, but it’s often worth the journey. By replacing your existing mortgage with a new one, you typically aim for a better interest rate, lower monthly payments, or a different loan term. This strategic move can free up cash, consolidate debt, or accelerate your path to paying off your home sooner – as long as it is done the right way!

Definition and Benefits of Refinancing

Refinancing involves taking out a new mortgage to replace your current one. This switch can offer several advantages:

Reduced Interest Rates: Lock in a lower rate to decrease your monthly payments.
Debt Consolidation: Combine multiple debts into a single, manageable loan.
Equity Access: Free up cash from your home equity for renovations or other significant expenses.
Term Adjustments: Modify the length of your mortgage to fit your financial scenario better.

Current Interest Rates and Opportunities in 2024

In the wake of the rate shocks of 2022 and 2023, many homeowners are keenly observing interest rate trends. Most economists predict a softening of the cash rate towards the end of this year, although this adjustment might be postponed to early 2024 if inflation remains high. In light of these forecasts, Proptrack produced this simple graph that outlines the major fours outlook on when they expect the RBA to commence their rate-cutting cycle and by what degree – crystal balling of course!

Evaluating Your Current Home Loan

Before you leap into refinancing, assess your current mortgage. Consider these factors:

Interest Rate: How does your rate compare to the new rates available? Is there a significant benefit to you to refinance? Can you stay with your current lender if they improved their rate?
Fees: Are there early repayment penalties or high ongoing fees?
Loan Features: Does your loan include features like an offset account or redraw facility, and do you use them?
Repayment Flexibility: Are you able to make extra payments without penalties?
Internet banking: Given the lack of branches these days it is important to know what their digital solutions are like. Still, in 2024 there remain enormous differences between the banks and lenders in regard to their customer Internet banking solutions – you would be surprised to know.

The Refinancing Process Explained

Refinancing can be broken down into several straightforward steps:

Goal Setting: Define what you hope to achieve with refinancing.
Financial Review: Assess your financial health and creditworthiness with an experienced mortgage broker.
Loan Shopping: get assistance to compare suitable loan products that meet your needs and not the banks.
Application: Submit your application and required documentation with expert assistance from your helpful mortgage broker at every step.
Settlement: Once approved, the new loan will pay off your existing mortgage.
Post-settlement: This is an important one. A great mortgage broker, like the ones at Axton Finance, will keep in touch with you and automate the review process to ensure you are never ripped off by your new lender. It’s in our interests to ensure you remain on a great rate, not your banks.

Conducting Market Research

Understanding the broader market context is crucial. Research recent trends in home loan rates, consider economic forecasts and review mortgage brokers and lender reputations and reviews (at the time of publishing we have almost 300+ five-star Google reviews). This information will guide you in choosing the right loan product and lender.

How We Can Help

At Axton Finance we specialize in helping homeowners like you navigate the complex world of mortgage refinancing. Our team of experts will guide you through evaluating your current loan, choosing the best new loan, and handling all the paperwork. Let us help you secure the best deal possible and achieve your financial goals. Contact us today to get started!

How is Your Home Loan Interest Rate Calculated?

Posted on 18/04/202418/04/2024 by Nick

Buying a home or just refinancing one usually means a hefty financial commitment – and understanding interest rates is key to making sound choices.

We often get asked how the interest rate on your mortgage is calculated.

Let’s dive in!

Factors Influencing the Interest Rate of Your Mortgage

Your interest rate isn’t a random number. It’s determined by several factors:

Credit Score: A high credit score indicates you’re a reliable borrower, potentially earning you a lower interest rate. If you want to get a free credit score report reach out to us.
Loan-to-Value Ratio (LVR): LVR reflects how much you’re borrowing relative to the property’s value. Higher LVRs may mean higher interest rates especially as you pass 80% LVR and it really ramps up over 90%.
Loan Type: Different loan types (variable, fixed, line of credit, interest only, intro rates etc.) come with varying interest rates. The cheapest form of lending is usually principal and interest for owner-occupied purposes. The more expensive rates are interest-only investment purpose lending. If your loan is an SMSF (Self Managed Superannuation Fund) loan then the rates are higher again because they are limited recourse structures.
Economic Climate: Interest rates are a function of controlling inflation first and foremost. The effects of rapid rates of inflation have a very corrosive effect on people’s purchasing power and the overall stability of the greater economy. To curb inflation, central banks, like the RBA (Reserve Bank of Australia) raise the cash rate, the rate at which banks borrow money from each other. When the cash rate goes up, lenders typically raise their interest rates, and vice versa. This discourages borrowing and spending, which can help slow down inflation. Conversely, if the economy weakens and inflation falls, the cash rate may be lowered to stimulate borrowing and spending.
Funding Costs: Banks lend you money from various sources which include but are not limited to deposits held, bonds and other security instruments. Depending on a number of macro-level variables source funding costs can be more expensive at times which sees the cost passed onto you, the borrower.

Types of Interest Rates

Variable Rates: Fluctuate with the market, and will rise and fall during your loan term. Banks and lenders can also move rates outside of RBA if conditions determine so.
Fixed Rates: Stay the same for a set time, typically 1-5 years, offering predictable repayments.
Split Rates: A combination of variable and fixed rate portions within the same loan.
Introductory rates: Also called honeymoon rates are, as the name suggests, a cheaper starter rate that ramps up after a period of time usually six to twelve months. In the long run honeymoon rates are generally a more expensive product solution and are rarely recommended by us.

What’s the Outlook in 2024 for Interest Rates

Interest rates are constantly changing. The best way to get an accurate picture is by comparing lenders or appointing a broker who proactively does this for you during the life of your loan (like we do at AXTON Finance!). Look at their advertised rates primarily, but be cautious in relying just on the so-called comparison rate which is usually an inaccurate assessment for larger loan sizes of $750k. It’s worth considering that comparison rates only compare a standard $150,000 loan over a set 25-year term including all fees and charges. An experienced mortgage broker can help demonstrate the effects of what a new loan term may really cost you, especially when you factor into account the long-term effects of consolidating debts, like a car loan or credit card into your home loan. The costs can be nasty if you are blinded by the ‘lower’ monthly repayment on offer.

Tips to Save Interest on Your Home or Investment Loan

Larger Down Payment: Lowering your LVR means potentially lower interest rates.

Shorter Loan Term: Reduces the total interest paid, though repayments will be higher.

Consider an Offset Account: Offsets your savings balance against your loan balance, decreasing the amount you pay interest on each repayment cycle. When used right this structure combined with the above concepts can have an enormous compounding effect on the cost of your loan.

Refinance Regularly: Don’t stick with the same lender forever because ‘it’s OK’ or ‘you are too busy’. Shopping around and refinancing when better rates arise could save significant interest if you are comparing apples with apples and getting good advice from an experienced mortgage broker.

Fortnightly Payments: Paying fortnightly instead of monthly means you make an extra month’s worth of repayments over a year, reducing interest faster. This can easily cut five years off a normal 30-year loan term.

Harness Credit Card Power: If disciplined, put all your expenses on a card with a long interest-free period (say 55 days) and pay it off IN FULL each cycle. In the meantime, your salary in your offset account reduces the loan’s interest-accruing balance.

Negotiate: Don’t be afraid to ask your lender for a better rate, particularly if you’ve got a good repayment history. Better still your broker should be regularly doing this for you as part of their ongoing service – if they aren’t you better speak to us.

How Axton Finance Can Help?

Navigating interest rates and loans can be overwhelming especially when there seems to be near limitless choice. That’s where we step in! As experienced mortgage brokers, we’re here to guide busy professionals like you through the complexities. We’ll compare lenders, help you secure pre-approvals tailored to your circumstances, and ensure you find the most competitive rates for your home or investment loan.

Let us help you make informed financial decisions – get in touch today!