berti-financial

What is LMI? – Lenders Mortgage Insurance

Tue, 16 Jan 2024 09:08:05 GMT

Lenders Mortgage Insurance has helped many Australian’s purchase their home sooner when they’ve had a smaller deposit.

For example:

If you’re seeking to purchase a house that’s $400,000 and you have a deposit of $40,000, banks will normally lend you $320,000 (LVR 80%) towards the price of the property.

However, if your income supports the loan and you are eligible to take advantage of Lenders Mortgage Insurance (LMI), the banks can potentially lend you the remaining $380,000* to buy your new home.

This means with your $40,000, you can cover your 5% deposit, stamp duty, and solicitor/conveyancer fees.

Lenders Mortgage Insurance is designed to protect the banks against the risks of providing you with a home loan in the event that you default on repayments.

In other words, it’s insurance for the bank but is paid by you, the customer.

It’s a one-off cost that is added to your home loan (so you don’t need to pay LMI upfront) and it allows you to borrow more than 80% of the property value for standard home loans.

The Lenders Mortgage Insurance charge varies with each lender and is a one off cost added to your loan balance.

So if your LVR (loan to value ratio) is greater than 80%, contact us and we’ll let you know how much your LMI charge will be.

Contact us to see how Lenders’ Mortgage Insurance can benefit you, call us on 1300 421 587 or email info@bertifinancial.com.au

*Based on an LVR of 95%. Bank lending policies vary, contact Berti Financial to find out more.

What is LVR? – Loan to Value Ratio

Tue, 16 Jan 2024 09:00:25 GMT

The Loan to Value ratio (LVR) is the way of working out the actual financial value of a property, and determines whether your home loan will need to be covered by Lenders Mortgage Insurance (LMI).

The Loan to Value ratio is the loan amount divided by the value of your property. Banks will require you to have Lenders Mortgage Insurance (LMI) if they lend more than 80% of the value of the property.

Here are some examples:

1. Loan amoun t: $250,000 divided by property value: $500,000 = 0.50% LVR (Loan-to-value ratio)

In this example, due to the LVR being under 80% you won’t be charged LMI (Lenders Mortgage Insurance).

2. Loan amount : $700,000 divided by property value: $800,000 = 0.87% LVR

In this example, due to the LVR being over 80% you will be charged LMI (Lenders Mortgage Insurance).

In regards to the LMI charge, it differs with each Bank. We’ll work this out for you.

So that’s how you calculate LVR on a single property.

But what if you have two properties?

For an example, let’s say one is an owner occupied home (which you live in) and another is an investment property and they are both secured together (cross-collateralized).

You would then add the total loan amount together, and the total security value together:

$450,000 (loan one) + $300,000 (loan two) = $750,000 (the total loan amount).

$720,000 (property one) + $400,000 (property two) = $1,120,000 (the total security value).

Total loan amount: $750,000 divided by total property value: $1,120,00 = 0.66% LVR.

You must take into account that the value of the property is determined by the banks valuation and not the price you paid for it. There may be a difference between the valuers price and the purchase price.

Contact Berti Financial to find out more about LVR and how it may relate to your next purchase.

Australian Homeowners Save Money And The Planet

Tue, 16 Jan 2024 08:56:02 GMT

Every time we turn on a light, the computer, kettle, toaster or hair dryer, we create pollution due to the burning of fossil fuels required to produce that electricity. Our homes have a critical role to play in mitigating the effects of climate change. Climate change is a global challenge that we cannot ignore. It is a threat to all of us yet created by all of us. Globally, we are all seeking a cleaner future looking into better alternatives.

There’s a lot we can do to turn back this worrying global trend of ever increasing carbon emissions. While solar panels aren’t the only answer they can certainly form part of the resolution.

The Project Green Home Loan

At Berti Financial we have dedicated time into developing an innovative and cost-effective way for home owners to obtain a good quality solar energy system for their home or investment property. Our goal is to save Australian homeowners money on their electricity bills, their home loan (even paying it off years sooner) and reduce their carbon footprint all at once.

Berti Financial has partnered with Australia’s leading solar companies to provide a service that makes building an energy efficient home more affordable. Through these great partnerships, we are able to obtain the maximum benefit with the least amount of out-of-pocket costs for our clients. We have done this by combining tailored low (or no fee), low interest rate home loans and a high quality solar solution with $0 upfront costs into one package.

“Our goal is to save Australian homeowners money on their electricity bills, their home loan, and reduce their carbon footprint all at once.”

We’ve called this package the Project Green Home Loan.

With the Project Green Home Loan, you will:

Receive assistance with applying for the Renewable Energy Systems rebate from the Australian Government which can be found here.
Obtain a discount from our solar partners when referred by Berti Financial.
Reduce carbon emissions for a cleaner planet
Gain FREE energy during daylight hours, helping to reduce your overall grid demand and ultimately, cut your costs up to 60%.
Drastically reduce your electricity bill.
Reduce your monthly repayments on your home loan. We’ll secure you a better deal by negotiating with various banks and lenders on our panel
Have more money in your pocket, increasing cash flow.
Have the option to pay off your home loan sooner, saving you thousands of dollars on interest.

How you will save money:

You increase a small amount on your home loan, using equity to pay for the installation of your solar package. During this time, we secure a better deal on your home loan.
The solar panels will generate free energy during daylight hours, reducing grid demand and cutting the cost of your electricity bill.
You capitalize from the savings on your electricity bills and then apply the savings to your mortgage as extra repayments.
You pay off your home loan sooner and save money on interest.

In addition, you will receive a rebate for installing solar which can be up to $800 per kW installed. This potentially halves the solar package end cost.

You’ll also receive a further discount from our partners when referred by us. This all makes solar more affordable than paying for power generated by burning fossil fuels.

How you will save the planet:

The average Australian home emits 7 tonnes of C02 annually. If 5% of Australian homeowners go solar, it would be the equivalent of

Taking 7,700,000 cars off the road (the average car emits 11,640 pounds of C02 annually).
Removing 89,600,000 pounds of C02 from the environment.
Planting 6,900,000 trees.

In a day, the amount of sunlight hitting Australia is more than 2,500 times the country’s daily energy usage.

Carbon dioxide (C02) is a greenhouse gas that keeps the temperature of our planet stable. In a natural cycle, C02 is taken up by the trees and plants. The trees and planets then produce oxygen as a by-product which makes our planet habitable. Since the 20th century we have been producing more C02 than our planet can handle, which traps the greenhouse gasses in our atmosphere which causes global warming. The difference in only 1-2 degrees in the annual average temperature has horrible consequences on our planet. Drought, pollution and health problems to us humans and animals are some of the many problems caused by C02 pollution and global warming.

What we do today will determine our tomorrow.

Save the planet , while saving money at the same time.

Contact Berti Financial today for a free comprehensive consultation.

Learn How to Write S.M.A.R.T Goals!

Tue, 16 Jan 2024 08:52:04 GMT

The importance of writing down your goals with a plan on how you are going to accomplish them is vital.

According to studies done at Harvard and Dominican University, those who wrote down their goals achieved more than those who did not.

For the Harvard study, students were asked if they had set clear written goals for their future.

Only 3% of the students wrote down their goals with a plan, 13% had goals but didn’t write them down and 84% had no goals.

After 10 years, the same group of students were interviewed again and the result of the study was astonishing. The graduates who wrote down their goals including a plan on average were earning 10x the amount as the other 97% percent of the class.

The study demonstrates that if you plan on how you are going to achieve your goal, then it allows for your goal to become more achievable. This leads you on a journey that has a destination.

Check out our S.M.A.R.T steps to take when writing your goals.

1. SPECIFIC – Make your goal specific!

Give yourself direction so you can hit the ground running. The best way to make your goal specific is to know ‘when’, ‘who’, ‘what’ and ‘where’

For example:

‘By the end of 2016 (when), I (who) am proudly earning an income of $____ a year as a Manager (what) at [insert company name] (where)’

Other examples:

‘In July 2016 (when), I (who) am travelling (what) around [country] (where)’

‘In October 2017 (when), I (who) am an owner of a [car] (what)’

‘This year (when), I (who) have purchased my first investment property (what) in [insert state] (where)’

‘Before the New Year (when), I (who) consolidated all my debt (what) and saved $____ per month’

2. MEASURES – What measures will you take in order to execute your goal?

Your plan is how you see, hear or feel the goal being achieved.

The goals noted in step 1 is the result of planning the actions to succeed.

‘I am speaking to [insert name] to discuss being promoted to a management position’

‘I am being paid $____ per fortnight, which is being deposited into my bank account’

Other examples:

‘I am speaking to my friends about planning a trip to [insert country]’

‘I’ve spoken to Daniel about purchasing a [insert car] and what my repayments will be’

‘I am saving $____ per week and using the money for a deposit to purchase an investment property’

‘I am speaking to Daniel to consolidate my debt and secure me a better finance deal’

3. ATTAINABLE – Is it possible?

Don’t rely on another person or luck! Write down a goal that is possible for you to achieve. You have to ask yourself: ‘Can I achieve this goal and am I in control of achieving it?’

Here are some example of an unattainable goal:

‘My partner/wife/husband is earning $_____’

‘I am going to lose 15 kilos in 1 week’

For the goal to be attainable, rephrase it:

‘I am helping my partner/wife/husband to earn $_____ a year’

‘I am going to lose 10 kilos in 6 months’

4. REALISTIC – C’mon!

Get motivated and stretch the goal out. Give yourself a challenge but make it realistic!

Don’t stretch it so far that you lose motivation. Losing motivation is disastrous when trying to achieve your goal.

5. TIMING – Deadlines!

When do you want to achieve it? Always incorporate ‘when’ into your goal. If you mix an achievable goal with a deadline, you’re bound to be motivated! Giving yourself a deadline will keep you focused and give you a sense of urgency.

Just remember:

Begin with I – it’s your goal, own it. Write in present tense – feel that you have already achieved it. Be specific – feel the accomplishment. What do you see, hear and feel?

By the way, the S.M.A.R.T steps aren’t set in stone. You can use the steps in any order that feels right with you, for example:

Measure
Attainable
Timing
Realistic
Specific

As long as it meets the the criteria, you’re setting yourself up for a greater chance of success!