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The federal Budget is just round the corner and many Australians will be bracing for their hip pocket to take a hit, with spending cuts and tax hikes on the government’s agenda.
While there has been a cooling in capital city house prices, the combination of the federal government Budget changes and softening economic conditions are likely to affect consumer sentiment and we could see prospective clients retreat from the market and put home buying dreams on hold.
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Brokers offering a range of financial solutions, such as a personal loan to reduce the level of a client’s commitments, possibly combined with a fixed interest rate home loan, may be enough to give consumers the confidence to enter the housing market.
This strategy could be applied with or ahead of a mortgage application to improve the client’s eligibility and shore up the application’s chance of success. For example, we worked with a WA broker whose client was told they would only be eligible for a Keystart loan if they could reduce their current level of repayments. We sourced them a debt consolidation loan and consequently they were successful in obtaining the mortgage.
Alternatively, debt consolidation can be a longer-term option for those who are at the beginning of their house buying dream. It can reduce your client’s outlays and help them get a better handle on their budget so they can accumulate a deposit. Ultimately, it will demonstrate to a potential lender that the client has a greater capacity to service a mortgage and has a good history in paying back loans.
By utilising a range of solutions available through specialist providers, brokers can identify ways for their clients to keep moving towards the elusive goal of home ownership. In doing so, brokers will add to their client base, reduce the number of incomplete deals, divide their time more productively and multiply profits – all without additional costs.
