Speaker 1: Hello.
Speaker 2: My name's Santasha Nabananga Bamblet. I'm a proud or the
Speaker 2: Order Kerni Whaltbury and a waddery woman. And before we
Speaker 2: get started on She's on the Money podcast, I would
Speaker 2: like to acknowledge the traditional custodians of the land of
Speaker 2: which this podcast is recorded on a wondery country, acknowledging
Speaker 2: the elders, the ancestors and the next generation coming through
Speaker 2: as this podcast is about connecting, empowering, knowledge sharing and
Speaker 2: the storytelling of you to make a difference for today
Speaker 2: and lasting impact for tomorrow.
Speaker 1: Let's get into it.
Speaker 3: She's on the Money, She's on the Money.
Speaker 4: Hello, and welcome to She's on the Money, the podcast
Speaker 4: here to remind you that your financial loyalty could be.
Speaker 1: Quietly costing you thousands of dollars.
Speaker 4: I'm Victoria Devine and if you don't know, I'm also
Speaker 4: the founder and director of Zela Money, your go to
Speaker 4: team of mortgage finance experts, and today we're going to
Speaker 4: dive into a topic that could literally put money into
Speaker 4: your back pocket, refinancing. And today we are definitely mixing
Speaker 4: things up. Instead of Beck or instead of Jess by
Speaker 4: my side, I've brought in someone who lives and breathes
Speaker 4: this stuff, because if we're going to talk about refinancing,
Speaker 4: I want you to hear from someone who actually does
Speaker 4: it every single day. Jacqueline Walsh has been on the
Speaker 4: show before and she is one of our senior brokers
Speaker 4: at Zela Money, and she's no stranger to the podcast.
Speaker 4: When she joined us last time, the community were obsessed
Speaker 4: and I mean same like I get it, So of
Speaker 4: course we had to get her back.
Speaker 1: Jacqueline, welcome back to the show.
Speaker 5: Thank you.
Speaker 4: I'm excited that you're here and we get to have
Speaker 4: a yap about finance again.
Speaker 5: I know we do it every single day, yeah, but
Speaker 5: it's not.
Speaker 4: But we get to have it like on a company
Speaker 4: couch instead of spinneach chairs, and that's like a little
Speaker 4: bit different. Today Jack, we are going to be walking
Speaker 4: through what refinancing actually looks like, how to know if
Speaker 4: it's worth doing, and everything you need to consider before
Speaker 4: making the switch. Jack, are you excited about this because
Speaker 4: I feel like at the time of recording, the RBA
Speaker 4: actually announced a point two five percent reduction on the
Speaker 4: cash rate yesterday.
Speaker 1: Yes, and so I could not be.
Speaker 4: More perfectly timed in having you on the show because
Speaker 4: now the cash rate is sitting at three point eight
Speaker 4: five and it is the first time in two years
Speaker 4: that it has sat below four percent, and I just
Speaker 4: think everyone in our office, we're just so excited about that.
Speaker 6: Yeah, that was a big discussion about it. A few
Speaker 6: of us thought maybe point five.
Speaker 4: Yeah, I feel like they're too conservative for that. Like
Speaker 4: the whole time, I was like, Nahn nutshul, thank.
Speaker 5: You, gotta put it out there.
Speaker 4: I reckon we'll get another point twenty five maybe next
Speaker 4: time the RBA meet or the time after that, because
Speaker 4: I know that we're technically all of the economy, so
Speaker 4: saying that by the end of the year, we are
Speaker 4: very likely to head towards the three percent mark, which
Speaker 4: would be oh, very nice.
Speaker 5: Look it's on its way down that We're thankful.
Speaker 1: Very very nice.
Speaker 4: But let's start the chat. For those who might not know, Jack,
Speaker 4: what is refinancing?
Speaker 6: Okay, So it's essentially replacing your old home loan with
Speaker 6: a new home loan. So that could be at the
Speaker 6: same bank that you're with, or you can look at
Speaker 6: going to another lender.
Speaker 5: There's like a whole different variety as to why you
Speaker 5: would do this.
Speaker 1: Yeah, but it's not.
Speaker 4: I think a lot of people are like, oh, I
Speaker 4: refinanced my loan recently, but they just called up their
Speaker 4: bank and got a better rate.
Speaker 1: That's different.
Speaker 4: Refinancing is actually picking up the finance offer you have
Speaker 4: and getting a completely new one. Yes, a bit of paperwork,
Speaker 4: a bit of organizing, having a chat with a good broker,
Speaker 4: but it's not so much about asking for a better rate,
Speaker 4: which we actually recommend you do definitely, And if you've
Speaker 4: got a good broker, like if you're a XYLA money client,
Speaker 4: you know this already. We are already going to be
Speaker 4: getting you guys better rates because it's part of our right.
Speaker 5: Like part of the service.
Speaker 4: Literally, when the cash rates go down, we are and
Speaker 4: we've got a pinned where you slack at work, We've
Speaker 4: got a pinned thread at the moment of all of
Speaker 4: the dates when all of the banks are actually going
Speaker 4: to be honoring that drop and letting us know, you know,
Speaker 4: how much they're decreasing their interest rates by, so that
Speaker 4: we can literally get on the phone and be like, hey.
Speaker 1: So you know all of our clients that's being passed
Speaker 1: on right like lock it in, Eddie.
Speaker 5: And then when they come to us.
Speaker 6: We can obviously tell them yep, it's happening this date,
Speaker 6: the bank's going to automatically pass it on or if
Speaker 6: you need to do anything else yet.
Speaker 4: But if you don't have a broker, I would definitely
Speaker 4: be considering calling your bank and going, hey, so just
Speaker 4: confirming that's going to be passed on, because sometimes in
Speaker 4: your terms and conditions it might be that yes, it's
Speaker 4: a variable interest rate, but like you've got to call
Speaker 4: them and lock in the lower rate otherwise they continue
Speaker 4: to charge you the higher rate.
Speaker 6: Yeah, it's not guaranteed with every single bank that they
Speaker 6: just cannot pass it on. Therefore your monthly your payment's
Speaker 6: going to be less every single month. So yeah, if
Speaker 6: you are directly with the bank, we definitely recommend jumping
Speaker 6: on the phone and giving them a call.
Speaker 4: Yeah, And it's a good idea to do that. And
Speaker 4: then if you haven't had any traction, maybe then's the
Speaker 4: time to have a chat to a broker to go Okay,
Speaker 4: well that didn't work, now what now what? Because we
Speaker 4: have done whole episodes on this show about like loyalty tax.
Speaker 1: Yeah, being loyal it.
Speaker 5: Doesn't pay, it's completely gone out the window.
Speaker 1: Yeah, being loyal it doesn't pay.
Speaker 4: So what do you think about the I guess comfort
Speaker 4: trap of sticking with your current lender. I think a
Speaker 4: lot of people are like, oh, I don't want to move.
Speaker 4: I really like NAB or Macquarie or A and Z
Speaker 4: or whatever, like I've been with them for twenty years,
Speaker 4: and like I banked with them and now I have
Speaker 4: my loan with them. Why are people so comfortable staying.
Speaker 6: I don't even know if it's that they necessarily like
Speaker 6: their bank like that they're you know, really want to
Speaker 6: stay with them. I think that the idea of moving
Speaker 6: is maybe just a little bit more daunting than it
Speaker 6: should be. Yeah, totally, I do understand, like why people
Speaker 6: get stuck or stay. I mean, everyone's so busy these
Speaker 6: days that just having another task to do, and you know,
Speaker 6: I think gone are the days where you used to
Speaker 6: have to sit on the front of hours and beg
Speaker 6: to put their rates down. Now, if you're directly with
Speaker 6: a bank most of the time that you can just
Speaker 6: jump on your app and I guess request a discount
Speaker 6: that way or send through an email. But if you
Speaker 6: have a broker, just shoot them off an email and
Speaker 6: just see where you're sitting and they can just have
Speaker 6: a look at comparing all the offers out there for you.
Speaker 4: Yeah, one hundred percent. And I guess how often should
Speaker 4: we be reviewing our mortgages?
Speaker 1: What does that look like?
Speaker 6: I would say every six months, and I say six monthly,
Speaker 6: just because both banks will only allow you to sort
Speaker 6: of do a pricing review once every six months. If
Speaker 6: you try and you know, do two or three in
Speaker 6: that period and they.
Speaker 4: Just don't allow it and they say sorry, three months ago.
Speaker 5: You're done.
Speaker 6: Yeah, so six monthly definitely, But there's obviously other reasons
Speaker 6: as to why you would look into that as well,
Speaker 6: So not just that.
Speaker 5: Obviously the rbas reduce their rates.
Speaker 6: Want to make sure that we're getting the best interest
Speaker 6: rate possible if there's been any changes to your circumstances,
Speaker 6: So you know, if your house has gone up, or
Speaker 6: you know, the naghbor down the road has just sold
Speaker 6: their property and they've got a great outcome, and you
Speaker 6: want to see what you're true and correct. Like LVR
Speaker 6: so loan to value ratio looks like that can have
Speaker 6: an impact on your rate as well, So it's definitely
Speaker 6: worth checking.
Speaker 4: Yeah, one hundred percent, And I think that you know
Speaker 4: you gave the advice call up your broker, but like
Speaker 4: it's quite They don't want to say it's funny, but
Speaker 4: it's interesting because some brokers do require that prompting of oh,
Speaker 4: hey can you review my loan and they go, oh, hey, Jacqueline,
Speaker 4: haven't spoken to you in a while.
Speaker 1: Yeah, yeah, yeah, I'll pick it up and have a
Speaker 1: look at it.
Speaker 4: Whereas like we and this is not mean like trying
Speaker 4: to stroke around egos, but like good brokerage practices will
Speaker 4: have a pricing team like we do, and their job
Speaker 4: is actually every single day going through the thousands of
Speaker 4: clients we have and repricing their mortgage. So, like our clients,
Speaker 4: once you kind of get in, you get on the cycle,
Speaker 4: and every six months we can basically guarantee that your
Speaker 4: mortgage has been reviewed, and it gets reviewed. We've already
Speaker 4: called the bank, we've negotiated the lower rate, and you'll
Speaker 4: just get email of probably a call from Jack being like, hey,
Speaker 4: just wanted to touch base. How are you We actually
Speaker 4: dropped your rate this week? Bye, I have a nice day.
Speaker 4: There's actually no admin from your behalf, which I think
Speaker 4: is if you're going to use a broker and like Honestly,
Speaker 4: if we're going to make money from you and your loan,
Speaker 4: I think we should be working for that. I don't
Speaker 4: think that we should just be taking it and being like, oh,
Speaker 4: let's cruise along. I just there's something about that that
Speaker 4: makes me feel uncomfortable to not put clients consistently in
Speaker 4: the best possible position.
Speaker 5: Well, we exactly right. We're going to do the work
Speaker 5: for you.
Speaker 6: So the second that you do settle, like you said,
Speaker 6: our pricing team will dirize every six months to do
Speaker 6: that work for you. So you don't have to dom
Speaker 6: on the phone, you don't have to send that email.
Speaker 6: It's just sort of set and forget and we'll do
Speaker 6: it for you.
Speaker 4: Yeah, one hundred percent. So when should we be considering refinancing?
Speaker 4: I feel like the biggest push is when people see, oh,
Speaker 4: the cash rates dropped, But there are six million reasons
Speaker 4: why you would refinance. Talk me through some of your
Speaker 4: recent refinances. Why are they refinancing?
Speaker 1: Jack?
Speaker 5: Oh?
Speaker 6: Like you said, there is so many reasons as to
Speaker 6: why you would. It could be as simple as changing
Speaker 6: your loan products. So if you're going from a fix
Speaker 6: to a variable or vice versa, if you're needing to
Speaker 6: access any equity, so you might be looking at consolidating
Speaker 6: any loans or just cashing out some money for renovations
Speaker 6: or whatever that looks like. Same with like I said,
Speaker 6: if the house price has gone up, or if you've
Speaker 6: made a lump some payment to your home loan and
Speaker 6: it's changing that LVR. A lot of the banks now
Speaker 6: are doing tiered interest rates, So if you're sitting between
Speaker 6: that seventy to eighty percent mark, you might get one
Speaker 6: rate you're sitting between sixty to seventy. So it's always
Speaker 6: worth staying on top of. But there is so many
Speaker 6: different reasons. It could even be just that you want
Speaker 6: to change the loan term. So what I mean by
Speaker 6: that is you might have a twenty loan term on
Speaker 6: your current home loan, you're looking up forraing a little
Speaker 6: bit more of cash flow. You might want to look
Speaker 6: at extending that just while the interest rates are a
Speaker 6: little bit higher, and then looking at bringing that back down,
Speaker 6: you know, after they sort of drop a bit more.
Speaker 1: Yeah, one hundred percent.
Speaker 4: And like financial advice, I think gets confused a lot
Speaker 4: of the time with mortgage brokers. I have this conversation
Speaker 4: in my DMS on i'd say a weekly basis. People
Speaker 4: will be like, oh my gosh, do I need to
Speaker 4: see a financial advisor because I want to talk about
Speaker 4: whether I should sell my property or rent it out.
Speaker 4: And to me, that's not a financial advice question, because yes,
Speaker 4: a financial advisor could sit you down and be like, okay, cool, Jacqueline,
Speaker 4: You'd be in the best possible position.
Speaker 1: If you xyzed.
Speaker 4: But like a broker is going to be able to
Speaker 4: model all of those scenarios for you and go, okay, Jack,
Speaker 4: if you sold, it would look like this, and this
Speaker 4: is what we would expect that property to sell for.
Speaker 4: And also, this is how much equity you've got. This
Speaker 4: is how much cash would probably come into your bank account,
Speaker 4: and you'd be able to play with that.
Speaker 1: Okay, if we rented.
Speaker 4: It out, this is what we could do with it,
Speaker 4: Like this is how much equity you've got to leverage
Speaker 4: into another property, and like we're part of that decision
Speaker 4: making team, Like, no, technically we can't tell you what to.
Speaker 1: Do, but we're just laying all the scenarios out and
Speaker 1: be like, oh, would you look at that.
Speaker 4: That one looks like it comes comes out ahead, doesn't it.
Speaker 4: And the client's often like oh my god, I would
Speaker 4: never want to xyz if I could do this. And
Speaker 4: so I think it's we're not leading you down the
Speaker 4: garden path, but we're giving you every single stepping stove everything.
Speaker 4: Pave your own path and work out what's going on.
Speaker 4: And I mean you could go, oh, well, Jack, what
Speaker 4: if I bought for six fifty? Oh, actually, what if
Speaker 4: it was seven hundred. We can like model out all
Speaker 4: of those different options. And I think that when you're refinancing,
Speaker 4: going well, what's that even look like? Like you've called
Speaker 4: your bank, you've got the lowest interest rate, but you
Speaker 4: know it's not the lowest interest rate on the market.
Speaker 4: Maybe you're going, well, what does it look like we've
Speaker 4: owned this house for five years. Let's have a look
Speaker 4: at what equity you've got. Because I think a lot
Speaker 4: of the time people are surprised, if there've been homeowners
Speaker 4: for a little while, at how possible and how easy
Speaker 4: it might be to get into their next property, whether
Speaker 4: that is you know, a bigger family home or an
Speaker 4: investment property or whatever that looks like. Often we sit
Speaker 4: down and go, did you realize you probably have like
Speaker 4: one hundred and fifty thousand dollars of equity and they're like,
Speaker 4: but I don't have that in my offset account.
Speaker 1: No, you don't.
Speaker 4: But the house is worth more than the mortgage that
Speaker 4: you owe, and so we could actually use some of
Speaker 4: that equity to buy an investment property and you don't
Speaker 4: have to come up with any cash. So that's a
Speaker 4: very popular reason we see in our community. I would
Speaker 4: say as to why people are trying to like refinance,
Speaker 4: because obviously that requires a different loan structure.
Speaker 6: Exactly, a lot of time people will put as much
Speaker 6: money into the home loan to reduce that loan. So
Speaker 6: instead of I guess having your savings sitting on the side,
Speaker 6: you've got it in your home loan working for you.
Speaker 6: So when the time comes that you want to look
Speaker 6: at purchasing that next property, we are able to access
Speaker 6: the equity and the extra funds that you've put into
Speaker 6: that home loan and draw it back out for your
Speaker 6: deposit for the next property.
Speaker 1: Yeah, exactly.
Speaker 4: And I think that a lot of people assume, oh, no,
Speaker 4: that must be financial adviceor broker couldn't tell me if
Speaker 4: I could, we can model it out. We can sit
Speaker 4: you down and go, okay, cool, this is what that
Speaker 4: would look like. This is what it would look like
Speaker 4: if you did it over here over there. And I
Speaker 4: think that that's the cool thing about it. It's free
Speaker 4: as opposed to going and seeing a financial advisor who
Speaker 4: would go, oh, so you you want to buy an
Speaker 4: investment property and they will do your whole financial plan.
Speaker 1: That's cool.
Speaker 4: But like the question that you wanted answered was can
Speaker 4: I afford it exactly? And I can work that out
Speaker 4: for you with one of my brokers very quickly and
Speaker 4: it won't cost you anything.
Speaker 1: So what are some.
Speaker 4: Signs that And I think this is a really important one,
Speaker 4: and people don't realize that, what are some signs that
Speaker 4: your mortgage maybe isn't working for you anymore? Like you
Speaker 4: set it up, you thought you did absolutely everything. You
Speaker 4: dotted all your eyes, you crossed all your t's, and
Speaker 4: now maybe it's not working for you anymore.
Speaker 6: Well, I think, I mean, offsets aren't new, but they're
Speaker 6: still quite relatively new. I guess in the lending world,
Speaker 6: if you don't have an offset, or you haven't entertain
Speaker 6: what that looks like, that might be something that you
Speaker 6: need to consider, especially having your salary paid into an account,
Speaker 6: or whether it's with the same bank or not with
Speaker 6: the same bank, just having a look at the different
Speaker 6: features that might be more beneficial to you.
Speaker 5: I guess yeah.
Speaker 4: I think a lot of people also, like if you're
Speaker 4: in a bit of a pinch and you're like, oh,
Speaker 4: I'm really feeling these mortgage repayments every single month, like
Speaker 4: you don't have to kind of suffer in silence. You
Speaker 4: can talk to a mortgage broker and go, okay, cool,
Speaker 4: well what could we do. How could we refinance this
Speaker 4: so that we're more financially comfortable today, but we still
Speaker 4: have a plan to pay it off before retirement exactly.
Speaker 4: And I think that that's an important factor as well,
Speaker 4: because sometimes you might be worried about refinancing because you're like,
Speaker 4: I don't want to start a brand new thirty year term,
Speaker 4: Like I don't need a new loan to restart.
Speaker 1: I just I don't think that's a good idea.
Speaker 6: But that's probably the top one that comes through, is
Speaker 6: that the refinancing. They assume that if you refinance, you
Speaker 6: have to push it back out to thirty years, So
Speaker 6: what do you do so in terms of when you're
Speaker 6: looking at refinancing, we don't have to stretch it back
Speaker 6: out of thirty years, But in some cases you might
Speaker 6: look to do that just purely because trying to free
Speaker 6: have a bit of cash flow at the moment. A
Speaker 6: lot of the time clients will keep it at thirty
Speaker 6: years so that they're contracted to thirty years and it's
Speaker 6: the bare minimum payments. But then when they settle, they'll
Speaker 6: jump online they can change it back down to, say
Speaker 6: to twenty years. So I can tell you exactly what
Speaker 6: that needs to look like and what you need to
Speaker 6: change it to too, paid off in twenty years time.
Speaker 6: But the beauty of it is, if you're contract to
Speaker 6: the bare minimum, at least you know that if something
Speaker 6: happens with work or you want to go on yeah travel,
Speaker 6: sit back, you can just drop it down for that
Speaker 6: month or however long you want, back to the bare minimum,
Speaker 6: and it's in control with you, like you don't have
Speaker 6: to contact.
Speaker 4: You're not going to get in trouble with that, like
Speaker 4: you are just yeah, killing it yourself.
Speaker 6: Yeah, I love So then you might come back, you know,
Speaker 6: after you've traveled for six months and say, right, you
Speaker 6: know I've got a promotion or I've got you know,
Speaker 6: more savings than I thought, I can make bigger repayments. Now,
Speaker 6: if I wanted to chop off, say another five years,
Speaker 6: what do my repayments need to look like?
Speaker 4: Now?
Speaker 1: Yeah?
Speaker 4: Yeah, And do you know what, Jack, you don't know
Speaker 4: if there's but at the time that this episode is dropping,
Speaker 4: I have a free mortgage repayment calculator dropping on our
Speaker 4: website as well, So we'll put the link to that
Speaker 4: in our show notes as well.
Speaker 1: But I think that that.
Speaker 4: Will be like a really helpful tool because it's a
Speaker 4: really basic spreadsheet that I've built that is, like you
Speaker 4: put your mortgage amount in, you put your interest rate
Speaker 4: amount in, and then you can play around with the
Speaker 4: repayments and see the time frame that it would take
Speaker 4: to pay that off. Because there's obviously a lot of
Speaker 4: maths that goes into the back of that that's not
Speaker 4: just like one plus one equals too, like your interest
Speaker 4: rate is kind of like it's compounds, like compound interest
Speaker 4: on an investment would, So there's a lot of like
Speaker 4: you end up paying a lot more of the mortgage
Speaker 4: off in the later periods of your life and a
Speaker 4: lot more interest at the start. So anyway, I will
Speaker 4: have that in the show notes for you to download
Speaker 4: for free, so that you can kind of play around
Speaker 4: with that or just even see, well, what would it
Speaker 4: look like if I could refinance and drop my rate
Speaker 4: by you know, zero point two five percent? Like does
Speaker 4: that actually put me in a better position? How much
Speaker 4: of a good position? Because it's very handy to know
Speaker 4: and feel like you're in control.
Speaker 6: And you might be in a position where with the
Speaker 6: rate cuts, you know the point if I've I mean,
Speaker 6: obviously everyone's a static about this and that means more
Speaker 6: money in it.
Speaker 4: But we're so excited, like we are happened yesterday for us,
Speaker 4: So like when you guys hear this, like just remember
Speaker 4: having yesterday.
Speaker 1: We're going out for lunch today, Like we are excited.
Speaker 6: You know, you might be in a position where you
Speaker 6: can keep that month your payment as is now and we're.
Speaker 1: Paying the same amount.
Speaker 5: Yes, some people.
Speaker 6: Want that money back in their back pocket, you know,
Speaker 6: free up cash flow.
Speaker 1: I get it.
Speaker 6: Some people might be in a position where they can
Speaker 6: keep it. Therefore they're going to end up paying off
Speaker 6: their mortgage quicker.
Speaker 4: Yeah, Like a good example there, Jack, if you're paying
Speaker 4: like let's say two thousand dollars a month to your
Speaker 4: mortgage and you're like, but I'm comfortable with that, why
Speaker 4: would I refinance? Well, if we refinance, you're going to
Speaker 4: continue paying that two thousand dollars a month, and that
Speaker 4: you're fantastic a lot less, you're paying a lot less interest,
Speaker 4: and that mortgage is going to be gone sooner. Yes,
Speaker 4: so yes, you might be in a quote same position
Speaker 4: day to day, but long term, you're putting yourself in
Speaker 4: the best possible position. So what would you say to people?
Speaker 4: And I've heard this a million times and I'm sure
Speaker 4: you have to who say, Look, refinancing is too much effort,
Speaker 4: can't be bothered.
Speaker 6: I can see why people would think that. I mean,
Speaker 6: it's definitely not as.
Speaker 4: Now we're saving money jack, like we are saving like
Speaker 4: we save.
Speaker 1: Clients more my years of dollars, Like over the life
Speaker 1: of your loan.
Speaker 4: I can almost guarantee that refinancing down point two five percent.
Speaker 4: It's not like fifty one hundred dollars, it's tens of
Speaker 4: thousands of dollars over that you're saving life. Yeah, we're
Speaker 4: not talking like oh yeah, why bother Like a pair
Speaker 4: of shoes, it's not a pair of shoe.
Speaker 1: It's a whole last caravan. You want the.
Speaker 4: Shoe store back yeah, so it's interesting how people go.
Speaker 4: Oh but week to week it does an impact, Yes,
Speaker 4: it does long.
Speaker 6: Term, I know, I see why people would think it's
Speaker 6: in the too hard basket.
Speaker 5: The aim is to make it as painless as possible,
Speaker 5: Like we don't.
Speaker 1: Want these to be a paople. I want you to
Speaker 1: love us, not by us.
Speaker 6: Yeah, I mean yes, it is like a normal application
Speaker 6: if you would say, go purchasing property. We do need
Speaker 6: your income documents, we do need to see bank statements,
Speaker 6: But like I said, we'll make it as painless as
Speaker 6: possible and.
Speaker 5: As quick as possible for you.
Speaker 6: If you are trying to say, match this up with
Speaker 6: like the refinance with say an fixed period date, just
Speaker 6: let us know so we can try and you work
Speaker 6: with you and try and match up those dates.
Speaker 5: But if we're not aware of that you're trying to
Speaker 5: match it up, you know it might.
Speaker 4: We just give us as much information as possible, Like
Speaker 4: the more info the better. Like it's such a I
Speaker 4: said this about financial advice, and the same is for
Speaker 4: mortgage broking, Like it's such a privileged position to be
Speaker 4: in to like know how you feel about your life
Speaker 4: and your goals and what you want to achieve, but
Speaker 4: also like financially what you're doing, Like, we are so
Speaker 4: lucky to be so trusted, but like you do need
Speaker 4: to find a broker that you trust. You can't just
Speaker 4: use anybody who you go, oh, my friend, use this guy.
Speaker 4: He seems a bit weird, but it's fine. Like I
Speaker 4: want you to be so confident that you're like no, no, no, oh,
Speaker 4: so Jack, we were actually thinking what would our mortgage
Speaker 4: your payments look like, Like what if we planned on having
Speaker 4: a baby next year? Yeah, because that does impact your serviceability,
Speaker 4: like a dependent joining their family.
Speaker 1: Is going to drop your borrowing?
Speaker 4: What actually, yes, and so we might go right well
Speaker 4: in that case, we're not going to tell you where
Speaker 4: to get pregnant, but like maybe let's try buy sooner
Speaker 4: rather than later so we can lock in a good
Speaker 4: rate and then we can talk about a baby a
Speaker 4: little bit late, Like we can.
Speaker 1: Have those conversations.
Speaker 4: And if you're not trusting somebody with you know, being
Speaker 4: able to have candid, nice conversations like that, like maybe
Speaker 4: they're not the right fit, because like we want to
Speaker 4: work as hard as possible to achieve your goals. Like
Speaker 4: when you win, we win. And I think that that's
Speaker 4: a really important reminder, Like if you don't feel comfy
Speaker 4: being like, oh hey Jerry, Yeah, so what would my
Speaker 4: borrowing capacity be if I had another baby?
Speaker 1: Like, yeah, I don't want.
Speaker 4: To talk to Jerry about my baby place. But Jack,
Speaker 4: I'm a cool Jack, Like, it's not just about us.
Speaker 4: It's more like, find someone that you just really gel with.
Speaker 4: Because from my perspective, sometimes people see the relationship you
Speaker 4: have with the mortgage brokers transactional. Yeah, but it's not
Speaker 4: like if you find a good mortgage broker, they are
Speaker 4: on your team for the life of your loan.
Speaker 1: That's like thirty years of us checking in.
Speaker 4: Always make sure you've got the best rate, talking to
Speaker 4: you about, you know, potential investment opportunities. Okay, cool Jack,
Speaker 4: you've got like enough for a deposit? Did you want
Speaker 4: to leverage that? What does that look like? Are you comfortable?
Speaker 4: Like we want you to be in the best possible
Speaker 4: position ever, I.
Speaker 5: Really like you comment around. You know, when you win,
Speaker 5: we win. It really does feel like that we're.
Speaker 1: Going out for lunch guy, because your interest rate dropped.
Speaker 6: I mean, who wants to be paying any more money
Speaker 6: in interest if you don't have to one hundred Like
Speaker 6: I just we're on cheese on the money, Like, I'm
Speaker 6: not here to waste my money.
Speaker 1: No, I didn't say I always spend it in.
Speaker 4: Line with other people's values, but like, I want to
Speaker 4: be able to be in the best possible financial position. Now,
Speaker 4: I think a lot of people are listening and they're like, look,
Speaker 4: maybe refinancing is worth it, but how do you actually
Speaker 4: do it?
Speaker 1: Is the question?
Speaker 4: So up next we're going to talk about the features
Speaker 4: that actually matter, the fees that you need to watch
Speaker 4: out for, and how to spot a deal that's actually
Speaker 4: worth switching for.
Speaker 1: So guys don't go anywhere.
Speaker 4: All right, So we're back, and I'm very excited about
Speaker 4: this because we've covered when refinancing makes sense and why
Speaker 4: it can feel a little bit overwhelming. But what happens
Speaker 4: when someone actually does it? Like, if we're going to
Speaker 4: go and do the whole refinancing thing, can you just,
Speaker 4: I guess, maybe share a client win that you've had recently,
Speaker 4: someone who thought maybe it was too hard but ended
Speaker 4: up saving a whole heap of money.
Speaker 1: You're like, yep, everybody there, because otherwise it wasn't refinance.
Speaker 4: We also, I guess if you come to a mortgage broker, right,
Speaker 4: and I know it's not worth three fun.
Speaker 5: You will tell you.
Speaker 4: We're not going to like, Babe, we don't want you
Speaker 4: to do the admin and go through hoops to then
Speaker 4: think that we didn't do anything.
Speaker 6: No, it did to be beneficial for you to do
Speaker 6: it to make the move.
Speaker 5: We're gonna like lay it all out there.
Speaker 6: We're going to compare it all, including like the discharge
Speaker 6: fees and the new like signing up fees and things
Speaker 6: like that, and if it doesn't make sense, we will
Speaker 6: tell you stay put, let's chat soon.
Speaker 1: Yeah, Like just sit pretty.
Speaker 4: You've actually got a pretty good deal and that's a
Speaker 4: good position to be in as well, because and you
Speaker 4: know that you're in the best possible position currently.
Speaker 1: But at least you're checking right, Yeah, exactly.
Speaker 4: So for anyone who's I guess never gone through this before,
Speaker 4: because I think a lot of our community they've just
Speaker 4: bought their first homes in the last few years and
Speaker 4: maybe they've never refinanced. What does the refinance process actually involve?
Speaker 4: So like, let's say I want you to do it
Speaker 4: for me, Jack, I pick up the phone and go, hey, Jack,
Speaker 4: you are now my official broker.
Speaker 1: What do I do?
Speaker 6: So I guess from here we would compare obviously rates
Speaker 6: number one, looking at you know, getting a lower rate,
Speaker 6: so less monthly repayments, things like that. We're going to
Speaker 6: look at the discharge fees, Like I said, what that
Speaker 6: looks like the land titles office fees to discharge the
Speaker 6: mortgage from the loan.
Speaker 4: That's a lot of fees. I don't think a lot
Speaker 4: of people thought about.
Speaker 6: No, but we will lay it all out on table
Speaker 6: for you, so we will compare it all. We'll send
Speaker 6: you an email. It's all you know, their fee to
Speaker 6: visually see it. So we're talking. You know what your
Speaker 6: rate is, what your payment is, what your startup fees
Speaker 6: look like.
Speaker 5: You discharge fees any of you and your fees with
Speaker 5: the new bank. You may or may not have had one.
Speaker 5: Do you have one now?
Speaker 6: So we've got to weigh it all up and make
Speaker 6: sure it's still beneficial when taking everything into account.
Speaker 4: Yeah, absolutely, so talk to me about Obviously I'm.
Speaker 1: Very pro broker.
Speaker 4: I own a brogage broker is kind of like I
Speaker 4: own a mortgage breaking business. Obviously am pro broker, but
Speaker 4: like I adore the idea of a broker for a
Speaker 4: number of reasons. But like Jack, why wouldn't someone just
Speaker 4: go directly to a bank instead of, you know, talking
Speaker 4: to a.
Speaker 1: Broker, Because that's a very valid question.
Speaker 5: Yes it is. I don't I want to say.
Speaker 4: Jacquelines or in PC in the nicest possible way. She's
Speaker 4: very complimentary of everybody in the industry, honestly, sometimes to
Speaker 4: her detriment.
Speaker 1: But I think it's.
Speaker 4: Look, I used to work for a bank, so but
Speaker 4: you did it, really you did a different role. But
Speaker 4: I think it's interesting because like if you go to
Speaker 4: the bank, it's kind of like going down to Let's say,
Speaker 4: you want to like go buy a packet of chips, right,
Speaker 4: So you walk into Smith's, the Smith's factory, and you say,
Speaker 4: what chips.
Speaker 5: Have you got?
Speaker 1: Yeah, and they're gonna.
Speaker 4: Show you all of the chips that they have in
Speaker 4: their particular range. They're going to go, oh, we've got
Speaker 4: these crinkle cut lines, they're really popular. We've got this, this,
Speaker 4: and this, and you go, okay, cool, Like that's all
Speaker 4: the chip ranges. I'm going to pick from that, and
Speaker 4: you've got maybe like five options, right.
Speaker 5: I'm going to say two or three?
Speaker 4: Yeah, Okay, Well, I don't know I don't actually buy
Speaker 4: chips that often. I just thought it was a good example.
Speaker 4: But then you go, all right, well, maybe I'll just
Speaker 4: go down to Coals or Woolies. And that's like you're broker.
Speaker 1: You go in. There's a whole damn aisle. There's every opportunity.
Speaker 4: There's a Red Rock Deli, you've got the gluten free options,
Speaker 4: you've got you know, Thins, You've got Lays, You've got
Speaker 4: Smith's is there too, Yeah, but you now have so
Speaker 4: many more options, so many more price points, so many
Speaker 4: more flavors and benefits. That's I guess the difference. So yes,
Speaker 4: you absolutely could go direct. If you're like, I don't care,
Speaker 4: I only want a bank with nab ever Victoria, that's great.
Speaker 4: You could be paying loyalty tax because you're not getting
Speaker 4: the best possible deal. You're not getting the best possible structure.
Speaker 4: Like we write now loans all the time. So don't
Speaker 4: think that RV doesn't like that. It's just an example
Speaker 4: because like for some clients that works perfectly, but other
Speaker 4: clients were like, oh my goodness, have you heard of Macquarie?
Speaker 4: Like this particular platform is going to give you unlimited
Speaker 4: offset accounts and this might make the most sense for you.
Speaker 4: So I think it's all about options and it is
Speaker 4: free to go to safe ways and look at all
Speaker 4: the options.
Speaker 1: Like they're not paying an entry fee.
Speaker 4: It's not like going and seeing a financial advisor where
Speaker 4: you have to pay thousands of dollars. We are very
Speaker 4: lucky in that we get paid by the banks, but
Speaker 4: only if your loan settles, only if it works. So
Speaker 4: that is to me really important because some people would go, oh,
Speaker 4: that feels a bit weird, but like, at the end
Speaker 4: of the day, you're not being charged more as a consumer.
Speaker 4: The bank is sharing their profit with us as kind
Speaker 4: of like a finder's fee. They're going, thanks Jack, we
Speaker 4: wouldn't have had that client without you, so we're going
Speaker 4: to split our profit with you. The client is always
Speaker 4: going to be in the best possible position. And because
Speaker 4: of Australian law and regulation, not only do we have
Speaker 4: to make sure you're in the best possible position, we
Speaker 4: have to give you three options every single time. You're
Speaker 4: not just getting one. You will always get given here
Speaker 4: are the top three options for you personally. So I
Speaker 4: think that that's not what would happen if you went
Speaker 4: to a mortgage broker who works directly for a bank
Speaker 4: or went to a bank directly. And it's not about
Speaker 4: like they're good brokers, like they are intelligent, they are smart,
Speaker 4: they just don't have.
Speaker 1: Access to the wide range exactly.
Speaker 4: And so just seeing a mortgage broker, you go, but
Speaker 4: I have a broker, Well, who were they employed by?
Speaker 4: If they're employed by a bank. To me, I would go, well,
Speaker 4: maybe you're not getting as many options put on the
Speaker 4: table as possible. They could be the best person in
Speaker 4: the entire world. I mean, you heard before Jacqueline used
Speaker 4: to work for a bank, but when you did, you
Speaker 4: would have had a limited range of opportunity.
Speaker 6: Pretty much looking at variable or fix really exactly. They
Speaker 6: will give you, obviously the best product that they can offer,
Speaker 6: I'm sure of it. But like you said, if you
Speaker 6: go into a broker, we've got I mean sometimes you've
Speaker 6: got sixty different lenders on your panel, so there's sixty
Speaker 6: different dictions that we can, yeah, put in the mix
Speaker 6: and show you exactly.
Speaker 4: And I think that that's really important to take into
Speaker 4: consideration as well. So Jack, beyond chasing a lawer rate,
Speaker 4: what loan features should we actually be looking for to
Speaker 4: make sure that refinancing actually improves our financial situation. Like
Speaker 4: I feel like so many times people just really get
Speaker 4: stuck on the numbers.
Speaker 1: And they're like, I just want to lawer rate, I
Speaker 1: just want to lower rate. What else are we looking for? Fees?
Speaker 6: I guess, and your fees accounts offsetting fees. Some banks
Speaker 6: will have it set per month or per year to
Speaker 6: take into account if you're paying any of those fees.
Speaker 6: Number one, do you have an offset? Is it going
Speaker 6: to be worth you introducing an off set? Do you
Speaker 6: have separate banking at different banks? Is it worth looking
Speaker 6: at putting it maybe with the one bank, and then
Speaker 6: that way we can put your savings into one of
Speaker 6: the offsets, or your holiday fund or your spending funds.
Speaker 6: Because all of that money that is in an offset
Speaker 6: is working for you. So you know, you're paying less
Speaker 6: in interest on your mortgage every single it's calculate daily actually.
Speaker 4: So it's so I guess on that as well. Your
Speaker 4: mortgage broker can and should, from my perspective, be helping
Speaker 4: you with cash flow. So they should be sitting down
Speaker 4: and going, all right, so this is how we're going
Speaker 4: to budget. This is what this looks like. This money
Speaker 4: goes into this. It's one of our favorite parts of
Speaker 4: our job. Like, once you've got your loan, being able
Speaker 4: to go okay, cool, We're going to put you in
Speaker 4: the best possible position by doing ABC and D. Got
Speaker 4: any questions, call me right because I'll know, and it's
Speaker 4: just so fun. We obviously have lots of different fees
Speaker 4: and that can be really overwhelming.
Speaker 1: But the flip side.
Speaker 4: Is cash back offers, Like I feel like they're probably
Speaker 4: going to make a resurgent soon because of the dropping
Speaker 4: cash rate, and obviously lots of people have their eyes
Speaker 4: on lots of different opportunities. So you might see some
Speaker 4: of the big banks going refinance with us and we'll
Speaker 4: give you three thousand dollars cash or two thousand dollar.
Speaker 4: When you see it all the time, it would be.
Speaker 6: I mean every single bank. I felt like I was
Speaker 6: playing part in that. Probably two or three years ago, it.
Speaker 4: Was everywhere in COVID, everybody was doing a cash back off. Yeah,
Speaker 4: and brokers can access that for you too. You don't
Speaker 4: have to go direct to that bank, like you call
Speaker 4: your broker first.
Speaker 5: Yeah.
Speaker 6: Now it has sort of dropped. There is only probably
Speaker 6: limited banks that are offering it. You got to wait
Speaker 6: it up like sometimes I do think it probably is
Speaker 6: a shiny distraction. I think it's easy if you don't
Speaker 6: have a broker who's obviously, you know, going to like
Speaker 6: I said, laid all out on the table for you
Speaker 6: to show you every little single fee and charge and
Speaker 6: take everything into account. I think if you're doing it
Speaker 6: direct to bank, it's easy to go, well, you know
Speaker 6: they're going to offer me two thousand dollars or three
Speaker 6: thousand dollars.
Speaker 5: Why wouldn't I.
Speaker 4: Yeah, money win, Yeah, but long term it might cost
Speaker 4: you more than I do find sometimes the interest rate
Speaker 4: is probably slightly higher than.
Speaker 5: What you could get. But I mean not to take
Speaker 5: it out.
Speaker 6: You just got to wigh up where that pinpoint is
Speaker 6: in your loan term, Like you know, after one year,
Speaker 6: is it now that we're at that break point where
Speaker 6: it's no longer working, and do we need to look
Speaker 6: at now either refinancing yet again to get a lower
Speaker 6: interest rate or you know, sometimes people will just slip
Speaker 6: into the comfort of just staying with them again, and
Speaker 6: that's probably how what.
Speaker 4: They're doing exactly probably got you in the door with
Speaker 4: the shiny thing, and then you stayed because it was warm.
Speaker 3: Here.
Speaker 4: I think that's interesting as well, because yeah, so many
Speaker 4: times we think that's a good deal. But like instant
Speaker 4: gratification versus delayed gratification.
Speaker 5: Sometimes forget like most of the time your loan is
Speaker 5: over a thirty loan.
Speaker 4: Term, yeah, and three grand over the long term, maybe
Speaker 4: you're paying ten thousand dollars more.
Speaker 1: Maybe not.
Speaker 6: I'm sure that that three thousand dollars is probably not
Speaker 6: sitting in your offset, you know, working for you.
Speaker 5: I'm sure that's already been spent.
Speaker 1: And oh yeah that in my head, that's free money. Yeah,
Speaker 1: that's not my saving that last free money.
Speaker 5: Yeah, going on a holiday with it.
Speaker 1: Yeah, yeah, money. We so talk to me about.
Speaker 4: Obviously, we want to be shopping for a better rate
Speaker 4: because it is important to get the best deal possible.
Speaker 4: But how does that impact my credit score?
Speaker 5: I mean, if you're just looking like window.
Speaker 1: Shopping, little yeah we window shopping, Okay, window.
Speaker 6: Shopping, it's not going to obviously impact your credit score.
Speaker 6: So if we're just you know, seeing what's out there,
Speaker 6: reaching out to a mortgage broker to see what options
Speaker 6: there are.
Speaker 5: Then your credit file is not being touched whatsoever.
Speaker 6: If we're actually committing to it, and actually going ahead
Speaker 6: with the refinance.
Speaker 5: Then obviously, yes, it is going to have a hit
Speaker 5: on your credit file.
Speaker 6: That's not necessarily going to have a negative effect. However,
Speaker 6: multiple times in a short period of time.
Speaker 1: Yes, this.
Speaker 4: Don't go talk to lots of brokers and submit lots
Speaker 4: of inquiries and do all of that, because I don't
Speaker 4: know how to say this, but you are disadvantaging all
Speaker 4: of the brokers if you are shopping around. I'm not
Speaker 4: saying don't have an initial chat with them, and if
Speaker 4: they're not the broker for you, go find somebody else.
Speaker 4: But don't go down the garden path. Don't like, submit
Speaker 4: a credit inquiry with a broker just to.
Speaker 1: See what options they can put on the table for you.
Speaker 5: They don't need to be doing.
Speaker 4: Yeah no, because all good brokers, honestly should be able
Speaker 4: to analyze your situation in exactly the same way as
Speaker 4: the next broker down the road and get the same outcome.
Speaker 4: And if they're not, I'm actually a little bit concerned.
Speaker 4: The important cherry on top there is like the relationship
Speaker 4: you have with them the above and beyond, what additional
Speaker 4: things does that business offer you in terms of support
Speaker 4: and ongoing client relationship and like whatever that looks like.
Speaker 4: And I think that that's really important to consider as well,
Speaker 4: because it's just it's so important that we're not just
Speaker 4: making multiple inquiries on our credit score just to see
Speaker 4: because that can drop your credit score and therefore make
Speaker 4: it harder to get a better deal exactly.
Speaker 6: Because when you a credit I think we've spoken about
Speaker 6: that previously, but credit scores can have an impact on
Speaker 6: which lenders will and won't take you. So therefore, instead
Speaker 6: of having you know, the door open to say, like
Speaker 6: a had sixty different lenders, you might only be able
Speaker 6: to now look at three options. Yeah, so it is
Speaker 6: hindering where you can go and what you can get.
Speaker 4: Yeah, and a broker we'll be able to guide you
Speaker 4: on that too, because like if you've got terrible credit
Speaker 4: or something, you can still have a chat and be like, well,
Speaker 4: what can I do Jack to either increase my credit score?
Speaker 4: Or like can I ever move while they have a
Speaker 4: bad credit score? And can you move? Like if my
Speaker 4: credit score is not amazing, Jack, don't have to wait?
Speaker 1: What can I do?
Speaker 6: We need to obviously have a look at it, see
Speaker 6: what it is, see what the actual background is, and
Speaker 6: what we can do, but there's certainly options. We've definitely
Speaker 6: had clients that have come to us that we've been
Speaker 6: able to move from a much lower rate that thought
Speaker 6: that their credit score wasn't too It.
Speaker 4: Wasn't amazing incredible, but like once we have a couple
Speaker 4: of conversations with the bdms and the banks, they're like,
Speaker 4: oh that makes sense. No, we'd be willing to accept
Speaker 4: them all good. That's where the relationship part comes into it.
Speaker 4: A lot of the time, Jack, this has been incredible,
Speaker 4: but unfortunately it is all we have time for today.
Speaker 4: Thank you so much for jumping back on the show. Genuinely,
Speaker 4: I feel like I was like not pulling teeth, but
Speaker 4: I'll it's.
Speaker 1: Like, so could you do this week? What about next week?
Speaker 4: Can you come on the show and talk about refinancing,
Speaker 4: because like, I'm getting a lot of questions about refinancing.
Speaker 4: I feel like you always explain stuff in a really
Speaker 4: clear and really practical way that just makes sense, and
Speaker 4: I know that people are going to find this really helpful, so.
Speaker 1: I appreciate it.
Speaker 4: Oh thanks, no, of course, And guys, it doesn't need
Speaker 4: to be a massive process, and getting the right support
Speaker 4: can make it a whole lot easier, even if you're
Speaker 4: just checking if your rate is going to drop. Is
Speaker 4: a great first step, and of course, if you've got
Speaker 4: questions or you want to help figuring out if it
Speaker 4: is the right.
Speaker 1: Move for you.
Speaker 4: The team at Zela Money we literally always here. I'll
Speaker 4: put our contact details in the show notes because if
Speaker 4: I can't shamelessly promote my own business on my own show,
Speaker 4: why are we here? And as always, if you enjoyed
Speaker 4: this episode, make sure that you're following the show, hit
Speaker 4: subscribe and leave us a review and share it with
Speaker 4: someone who you think might need a little refinancing nudge.
Speaker 4: We'll see you again on Friday. Bye, guys, Bye. The
Speaker 4: advice shared on She's on the Money is general in
Speaker 4: nature and does not consider.
Speaker 1: Your individual circumstances.
Speaker 4: She's on the Money exists purely for educational purposes and
Speaker 4: should not be relied upon to make an investment or
Speaker 4: financial decision. If you do choose to buy a financial product, read.
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