Consolidating your loans this EOFY

Debt consolidation case study

Northern Rivers Lending Specialist, David Seymour, was introduced to a couple who were both wage earners, trying to get their debt under control with little success from the major lenders. 

debt consolidationBeing a small family with one child, they were living pay-to-pay but couldn't get their heads above water. It felt like they were continually paying off something all the time. 

To try and grab a break, they went to see major bank about consolidating their loans. When they were turned away they went to their existing lender to find out that they also had no time for them. 

They completed paperwork in the hope of being approved and the process only dragged on, so they became disenchanted and gave up. 

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Northern Rivers Lending Specialist Insights

Insights from Northern Rivers Lending Specialist, David Seymour (Part 2)

Following our February article read why, when it comes to loan applications, David is ready to ask the right questions.

David Seymour"For anyone self-employed you need to run your business and take a wage to service your debts – is there sustainable income or industry change ahead that affects your ability to secure the finance you need?"

David's due diligence includes reviewing the financial statements and clients' needs analysis to understand the needs that the applicant is seeking and how he can match those with a suite of products from different lenders. 

"At times I need to play the devil's advocate to help achieve the end goal in the most effective way and eliminate as many questions as possible regarding an application," says David. Read more…

Northern Rivers Lending Specialist David Seymour

Insights from Northern Rivers Lending Specialist, David Seymour

Northern Rivers Lending Specialist, David Seymour, led an illustrious career with AGC Finance and Westpac, was headhunted by a mortgage fund and then BankWest before setting up shop on his own as a specialist home loan and commercial lender in 2015.

David Seymour (left)During his time in corporate banking David was rated #1 Commercial Manager in NSW, involved in some exciting pilot projects around business development success roadmapping, mentoring and customer management initiatives which live on today.

Originally from Tamworth, David has called the Northern Rivers home since 1980. In all his roles he has enjoyed the challenge of starting small and building a success.

"I'm a people person and I value the importance of relationships," says David. "They help us achieve our goals and aspirations and I get to meet some really good people in the process." 

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Mortgages and Lending comparison rates

What are comparison rates?

When you are researching home loans, you will always see the lender's actual interest rate followed by what is called a 'comparison rate'. Why is there a comparison rate? What is a comparison rate? And more importantly, how does it help you?

comparisonSeveral years ago the federal government thought that it was a great idea to make lenders disclose not only the actual rate that they were charging, but also what their effective (or the true cost of a loan) interest rate is. This was done to allow consumers to understand more fully what a loan would cost, and how the various lender offers compared to each other – therefore a 'comparison rate'

The issue is that when you see an advertised rate / comparison rate it is based on one single scenario – usually a loan of $150,000 over a term of 25 years. So, if your loan does not match that scenario the comparison rate is not correct for your circumstances. Your actual comparison rate may be higher or lower. A loan that seems cheaper may well not be when your individual requirements are assessed.

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Consolidate your debts

If December was the time to be Merry, is the New Year the time to be sorry?

How great was Christmas and all the school and summer holidays? The lucky ones among us have had a couple of weeks off to spend with family and friends and had a great time.

debtNow that we're well into 2019 and so the hangover begins as the credit card bills come in.

What can you do?
Pay close to 20% interest and tough it out, hoping to be able to pay the card down as soon as you can, or pay the minimum each month and on it goes on, and on, and on… the important thing now is to not bury your head in the sand or to be embarrassed to find a solution.

The alternative is to try to consolidate your debts – home loan, car loan, personal loan, credit cards, as much as possible all into one loan at the cheapest rate that you can access. Just as important when you are doing this is to set yourself a budget that you will stick to so January 2020 doesn't cause as much pain as the current one.

If you want to spend the average of $3,800 (apparently that is what we all spend on average at Christmas on food, drinks, and gifts) the answer is to start now – pay $300 a month extra off your home loan – you can afford it now that you have consolidated your loans – so by the end of the year you have a kitty of $3,600 ready and waiting for you. Yes, the discipline is hard to start with, but it gets easier as the months pass.

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