The Little Black Book of Scams

The ACCC has just released a brand new edition of its very popular The little black book of scams.

The little black book of scams highlights a variety of popular scams that regularly target Australian consumers and small business in areas such as fake lotteries, internet shopping, mobile phones, online banking, employment and investment opportunities. It also offers consumers tips on how to protect themselves from scams, what they can do to minimise damage if they do get scammed and how they can report a scam.

Scams do not discriminate; they target people of all backgrounds, ages and income levels. There is a scam out there for everyone. The little black book of scams has been designed to be appealing and accessible to a broad range of people–younger people; older people; families; and business people alike. It is colourful and engaging and the information is clearly set out so you can find what you are looking for.

Stay one step ahead of the scammers. Read The little black book of scams get the low-down on scams which target you! You can also check out Scamwatch

You can download a free pdf of The little black book of scams clicking on the link.

DOWNLOAD HERE

Love That Place: Social Networking meets Real Estate

Love That Place, which just launched earlier this month, is a social network designed to let users search, discuss, rate and register interest in property, whether it's for sale or not.

Property owners begin by creating a page and uploading photos of their place—simply to gather feedback and advice, or to test the market and see what other people think. Members of the site can leave comments or send private messages (forums are coming soon), and admirers of a particular property can even send a virtual "door-knock" to see if the owner would consider selling.

If the owner is interested, the two parties can negotiate privately or through a facilitated process with an agent. Both casual users and serious investors and developers can use Love That Place, with services tailored accordingly. Membership options range from a free, standard option that covers listing up to 3 properties, all the way up to a "property guru" level that's AUD 249 per year for up to 300 properties.

Love That Place is definitely more of a social network than the other real estate 3.0 sites we've covered, with its features for conversation and networking. But the basic premise is the same: Even property owners who aren't actively trying to sell their homes can often be convinced to sell when the offer is right. It's a matter of facilitating intentions, and it's a new approach to selling property around the globe. Those in real estate: Don't delay too long!

Website: www.lovethatplace.com.au

Australian's Repossessed: Foreclosures on the Rise

Foreclosures in New South Wales set to rise to a record this year after the central bank increased rates twice in the past two months to a 12-year high.

Banks are in the middle of their third mortgage rate increase this year and that's pushing more Australian families out of their homes.

Mortgage payments are increasing at least 2 1/2 times faster than household incomes. Lenders including Commonwealth of Australia Bank Ltd. and National Australia Bank Ltd., the nation's biggest, have raised loan rates three times this year, boosting the average monthly mortgage payment by more than the average annual increase in wages.

We're only now really starting to see a situation where defaults arise because people aren't able to meet their payments.

The Reserve Bank of Australia last week increased its benchmark borrowing cost for the fourth time in seven months to 7.25 percent to cool inflation that grew at its fastest pace in 16 years in the fourth quarter.

Banks are charging more as the global credit crunch raises funding costs after investors fled debt markets, as fewer residential mortgages are being granted after funding costs are increasing in the wake of the U.S. subprime market's collapse.

Global financial turbulence and the peculiar exposure of the Australian financial system which is heavily dependent on foreign markets for funding, and this leads to the banks having to charge more.

A situation in Sydney's West recently saw one mortgage holder owed A$600,000 and received bids of no more than A$330,000 when his property went to auction.The seller had previously refinanced, adding more debt to the A$475,000 or so he borrowed to buy the house. Some people are just walking away from their properties: the equity's halved in many cases.

Housing affordability dropped to the lowest in at least 33 years in December, as average disposable incomes stayed below the amount needed to qualify for the median home loan for the fifth- straight quarter, according to an index compiled by the Housing Industry Association and the Commonwealth Bank.

Repossessions in New South Wales rose 1.6 percent to 5,454 last year, according to figures from the state's Supreme Court. Victorian repossessions increased to 2,720 in the year to June 30 and have tripled in the past four years, according to the state government.

The actual number of mortgage defaults may be four times the repossession figures, which only include seizures and sales approved by the Supreme Courts of New South Wales and Victoria.

Rising borrowing costs are pushing more families into housing stress, with some 1.1 million Australians paying more than 30 percent of their income in rent or home-loan costs. In fact, Australians are paying the second-highest mortgage rates in the developed world.

Simon Turner simon@marquetteturner.com.au

Layman's Terms: Low Doc & No Doc Finance Explained

These types of loans are generally suited to small business & self employed. Specifically these loans have been designed for borrowers who may not be able or do not want to substantiate their income for a variety of reasons.

Lenders of these loans require an applicant to evidence business activity, currently the primary test for most lenders is an ABN for 2 years & GST registration. In the absence of a full set of recent financials other substantiation may include letters from Accountants, BAS statements, proceeds from sale of assets & other business documents to support this business activity status.

There are some lenders operating in this space that do accept a lower set of criteria. Of course it makes more sense for investors to have access to a wider range of lenders, so our advice is to try and conform to the main level of lenders’ expectations.

Another important aspect to these types of loans involves mortgage insurance. In the Australian market today most of these types of loans are insured by a mortgage insurer. Depending upon the specific arrangements between the lender & the mortgage insurer these institutions cover all or part of the lenders risk in the event of a loan defaulting. In some cases the lender will absorb this fee generally up to certain Loan to Value Ratio (LVR) or loan value thresholds.

Relative to the number of products & lenders in the market there are very few mortgage insurers, in fact currently only 2 mortgage insurers dominate the Australian market place. It is these bodies that set many of the parameters, rules & guidelines for the finance industry including lenders at the higher LVR (where mortgage insurance is applicable) end of the finance market. Some of the major elements that are impacted by mortgage insurers include: security type, location (post code), maximum LVR & maximum lending amount.

Obviously these measures are used to minimize the risk & the extent of potential loss. Let’s face it lenders first aspect in lending money is “not to lose any money”. They do this by lending on assets that are not likely to go down in value & to lending to individuals & entities that have the capacity to repay their money!

Simon Turner simon@marquetteturner.com.au