Take control of your budget

Take control of your budget

Getting your budget under control and your finances in order is absolutely essential to anyone looking to apply for a home loan, but it’s particularly important for first home buyers about to take the first step on the property ladder. Now the end of financial year has arrived and you’re getting all your paperwork together for your tax return, why not take stock of your financial situation and plan your budget for the year ahead at the same time? Here’s a few things to consider to get financially fit for a home loan application in the new financial year.

Reassess your budget and get serious about your savings

When you apply for a home loan, particularly as a first home buyer, it is important to have a thorough understanding of your financial situation and good savings habits. Lenders will want to see an established history of regular savings before they will give you their best rate on a home loan and for this reason, you should take a realistic look at your spending habits and create yourself a budget to ensure your savings will grow at a steady rate.

Work out how much deposit you’ll need and set yourself a savings target

If you set yourself a savings target, you may find it will be much easier to stick to your budget. To set your target, first you’ll need to work out how much you need for your deposit. The amount of deposit you will need will depend on the cost of the property you want to buy, but if you have an idea of the kind of property you want to purchase you’ll be able to set a goal. It’s recommended that you have a deposit of at least 5% of the purchase price, however if you can possibly save 20% of the purchase price you’ll avoid paying Lenders Mortgage Insurance.

Make an accurate assessment of any debts and ongoing expenses

Lenders assess your creditworthiness on the amount of money you already owe, your ability to repay your debts and your capacity to take on more debt. Paying down any credit card debts or personal loans prior to applying for your home loan will improve your borrowing capacity and give you the best chance of loan approval when you apply.

Even if you don’t have any debt on your credit cards, lenders take into consideration the credit limit on your credit cards and count this as potential debt. So if you have several credit cards, it may be a good idea to cancel some of them now if you are planning on applying for a home loan in the next financial year.

If you have a lot of debts, think about consolidating them

If you take stock of your debts and realise you won’t be able to pay them all off anytime soon, it’s a good idea to look at ways to reduce your interest liability. Credit cards, store cards, short-term personal loans and cash advances all carry high interest rates and this can make them quite difficult to pay down. Getting your finances in order may mean it’s time to consolidate your debts.

Consolidating your debts means rolling all your debts into one, usually using a loan that has a lower interest rate. If you have quite a few expensive debts it may be possible to roll these into your home loan if you have one, or perhaps a personal loan that carries a lower interest rate overall. This may save you a great deal of money on interest payments, which is money you could use to pay off your debts faster. It could also allow you to spread your repayments over time, making them more affordable. If you want to be eligible to apply for a home loan in the next financial year, consolidating your debts sooner rather than later may be a good idea.

The end of financial year is a great time to get your finances in order and you never know, you may get a tax refund that could really give a boost to your savings efforts for a deposit for your home! Remember, we’re here to help you get your finances under control so you can save your deposit and get into your new home sooner. If you’re planning on applying for a home loan in the next financial year, don’t hesitate to give us a call today.

Keep your indoor plants happy this winter

Winter is here and during these colder months, your indoor plants are going to have a harder time staying healthy and will require a little extra care. Not only do indoor plants make our home look lively and fresh, they also purify the air we breathe so it’s important to keep them happy!

Here are some important tips to keep your plants happy and healthy when the mercury starts to drop.

Water with care

In winter, most indoor plants don’t need as much water as they do in the warmer months. Water your plants less frequently, ideally once a week or best to let the soil dry out first (depending on the plant variety’s needs). Lift the pot and feel its weight – a dry pot will feel lighter than a damp one. Another good way to know when to water is to push your finger into the soil up to 5cm deep – water if it’s completely dry. If it’s still moist, leave it for a couple more days and then check again. Here are some common signs to look out for:

Your plant is thirsty when

  • the leaves are brown and crunchy
  • the plant looks skimpy

Your plant is overwatered when

  • the leaves are starting to turn an unusual yellow from the edges
  • the plant or leaves are misshapen or discolored

Optimal location for light and temperature

Just like us, plants need sunlight to be happy and healthy. Grey winter days mean less exposure to sunlight so you may need to move your plants to a location where they can soak up some extra rays. A sunny windowsill might be tempting but it can deliver extremes of daylight heat and cold nights, which many plants can’t handle. Place them in a well-lit room, slightly back from a window that offers gentler light. Make sure to keep them away from the heater’s radiation and areas where it could be exposed to cold blasts.

Create an environment to help them thrive

Many indoor plants are rainforest species which prefer humid air. Humidity rapidly drops in winter and some heaters dry the air which means you may notice your plants also drying out. To help with this, occasionally mist the leaves with water to give them some moisture. Grouping the plants together also works as they will form their own microclimate. Add a pot of water nearby or stand the plants on a bed of pebbles in a tray of water that will evaporate around them.

Show them care regularly

It’s best to check your plants 2-3 times a week to assess their health but don’t fuss over them or ‘kill’ them with kindness. Give them attention when they need it and keep an eye out for signs of over watering, under watering and lack of sunshine.

By helping your indoor plants thrive through the cooler months, you will reap the full benefits they provide. Aside from creating a homely environment, they also improve air quality and can boost your mood. A study published in the Journal of Physiological Anthropology shows that active interaction with indoor plants (like touching and smelling) can reduce psychological and physiological stress.

Remember that many plants go dormant in the winter, so they’ll grow slowly during this time. Just be sure to keep up with their essentials to sustain them through winter and keep an eye out for early signs of problems so you can enjoy them through to summer.

EOFY: Why property investors love tax time

EOFY: Why property investors love tax time

Don’t you just love getting a tax refund? Whilst nobody enjoys all the paperwork that goes with filing a tax return, getting it right can be rewarding particularly if you’re a property investor. One of the major benefits of investing in property over other asset classes, is support for your investment from the Australian government in the form of tax relief. And of course, if you have a property investment or are considering investing in property soon, you won’t want to miss out on a single cent from any of the deductions that are available to you. Here are some tips to help you maximise your tax benefits this financial year if you are a property investor.

Make sure you’re claiming every cent you can for depreciation.

Depreciation is one of the major tax benefits that property investors can claim. Depreciation occurs as an item’s worth becomes less over time as it is used and it wears out. When you’re talking about a tax deduction, depreciation is a method of allocating the cost of an item over its useful life. For example, if your investment property has an oven that is valued at $1,000 and has a ten year life, you can claim $100 against your taxable income for 10 years on that individual item.

With an investment property, you are only allowed to claim depreciation on certain items against your taxable income. There are two types of depreciation tax deductions that you can claim:

  • Depreciation on plant & equipment: this refers to items within the building like ovens, hot water heaters, air conditioners, carpets, blinds, light fittings and so on.
  • Depreciation on buildings or ‘building allowance’: this refers to the construction costs of the building itself, such as concrete, brickwork, and so on.

In order to make a tax claim for depreciation, you need a report that identifies all the things that may be claimed against your tax and the current value of each item. This is called a depreciation schedule. Unfortunately, the Australian Tax Office will not allow you to create your own depreciation schedule, you’ll need to employ the services of a qualified Quantity Surveyor to do a thorough inspection to identify what can be claimed and make the necessary valuations on those items. But don’t worry, the cost of preparing your depreciation schedule is also tax deductible.

Spend money on property maintenance now so you can claim it back right away

Every investment property requires maintenance and if you do it in June, you won’t be out of pocket for the expense for very long. If your property’s smoke detectors need servicing, or you haven’t sent the pest control company around for a while, now is a good time to do it. Cleaning, gardening and lawn mowing costs are also usually tax deductible (for you, not your tenant). Any other necessary repairs, maintenance and service costs – like checking the gas and hot water heaters for example, are also tax deductible for most property investors, so consider taking care of any issues before the end of the financial year.

Get back the other money you hate to spend

When you own a property, it sometimes seems like you have to pay out a lot of money for invisible things that don’t have much benefit for you, which can be annoying. Tax time is when you can get your own back, with land tax, council and water rates, property management fees, advertising costs for marketing the property to tenants, body-corporate and strata-title fees all tax deductible expenses.

Remember to claim your finance and insurance costs

Generally speaking, you are allowed to claim all finance costs associated with your property investment, including bank fees and charges, borrowing costs and interest on your loans. All insurance costs for your investment property are also tax deductible. So if you talk to us about your insurance coverage now, we can make sure you have the right cover for your current needs just in time for you to put in a claim for the cost with this year’s tax return.

Remember, if you’re a property investor or are considering investing in property soon, we’re here to help you get your finances right. We can help you access a loan structure that’s right for your ongoing investment strategy and help you access the most competitive rate available for you considering your personal financial circumstances and goals. Give us a call today.

YOUR FIRST MEETING WITH XCLUSIVE MONEY

If you’re looking for a home loan but are inexperienced with finance brokers, attending your first appointment with a broker can be a nervous experience.
Getting a home loan, after all, can be quite complex for a first-timer.
Xclusive money is here to support you and there is a lot to learn. But there are many steps you can take to be confident that your appointment will be a success with Xclusive Money.

A good starting point is to familiarise yourself with the expectations of the first appointment between Xclusive Money and yourself. Your broker is very likely to ask you about your medium and long-term financial goals, the amount you want to borrow, comparisons of your home loan options and your understanding of the fees, costs and conditions attached to home loans. Knowing the direction the appointment will likely take lets you participate more actively in the conversation. This means you can better articulate your needs with Xclusive Money.

It’s also recommended that you give some consideration before the meeting to the types of questions you wish to ask Xclusive Money.
Questions that can be of use include such things as loan types (such as term, repayment options and interest rate types), the types of ongoing fees attached to various loans (such as early exit, late payment, break and redraw fees) and the typical timeframe for a loan settlement.

These questions might pop into your head spontaneously during the meeting but preparing them in advance is a good way to refine them. By doing so, you are in a position to get more specific information from Xclusive Money.

It is common practice, too, for Xclusive Money to conduct a needs assessment prior to your face-to-face appointment – so you may be asked some pre-appointment questions.  To assist in answering these, you’ll need to supply information about your employment history, assets and expenses.

At the appointment it will save you time and effort to prepare and then bring the required documentation with you. This can include ID, transaction histories, tax returns, rental income statements and borrowing documents such as “contract of sale” and proof that you have the deposit for a property. It’s mandatory for brokers to maintain the confidentiality of information that you provide to them and only pass on information necessary to enable them to lodge your loan application or where required by law.

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An Xclusive Bang

Hello, and welcome to Xclusive Money.

I would like to intorduce myself, I am Damian and I am the owner of Xclusive Money.
Xclusive Money is a finance company, if you havnt already guessed! 

Our mission and our job is to help you with all your finanical needs, as you make those xclusive purchases throughout your life – House, Car, A Business, Family Holiday, anything really!

Essentially we don’t do much different to any other finance company but we do actually really care and are passionate about being part of getting you what you want!

I come from a background in banking. Im passionate about helping others and I guess Xclusive came from my drive to help people become the absolute best they can be in every area of their life.

Xclusive Money is just the beginning, of the bigger picture of the brand and presence within australia. 

As a broker, we work for you. Every scenario is different and it is our job to find you the best solution for you plus we do actually care about you. 

I like to think we are all fairly clever and creative and we do love to have a laugh (and a wine!). We are so lucky to have just the greatest clients. I have a lot of fun with them all. I love to be part of their lives and usually end up as a life long friend or adopted son.