News
Disruption and Other Naff Expressions
You read about disruption of one industry or another these days as if it were the fourth horseman of the apocalypse. Effectively it means the introduction of a new technology or process to upset the incumbents in an industry. When did this become a thing?
A Good Roger Ng
It turns out that by going with the lease offered to him by MBF Roger gets three years of free servicing (that’s valued at around $4,300). He also gets a guaranteed buy back on his vehicle. We further learned that MBF was very negotiable on the rate (which, as discussed last week, makes very little difference to monthly lease repayments – within reason). So we told Roger to renegotiate the rate and seriously consider going with MBF even though his repayments would be slightly higher. We couldn’t match the benefits that he was getting from MBF.
To Lease or Not to Lease
After many, many years of outright car ownership, I’m returning to leasing. Why? Well, two reasons really.
Firstly, a car (no matter how nice when new) is a depreciating asset (like many other business assets).
Home Loan Confusion
Not all that long ago, home loans were simple. If you wanted one, you’d walk into a branch or call your broker and you would get one. If you wanted one for investment purposes, there was no difference in price. The only real price differences between products was if you wanted an equity loan.
When Banks Get It Wrong
Over the past few decades there has been a relentless march by Australian banks to reduce costs. I used to work for three foreign banks in the 80s, 90s and naughties who used to laugh at Australian banks’ cost to income (CI) ratios – all below 50% (now in the low 40s). They’re not laughing now.
They Know Not What They Want
The message we gave him was that while he had good servicing and a house as security, his credit history meant that no bank would touch him (for now).
Gather Ye Rose Buds
Lately, we’ve had many an enquiry from property developers many of whom still believe their bankers will lend them funds to complete the project they began (say a year ago) but has been held up in various stages of approval since.
Interest Only
When I first put in place a home loan 32 years ago all I could think about was how I was going to pay it off and own my own home. The day I made the final repayment was one I’ll always remember. I was free of the bank…until we decided to upgrade but that’s another story. My point is, back then, we weren’t given the option of an interest only repayment.
Tell Me Everything
In our travels we come across many different types of people. Some people are an open book, others…not so much. Given we have to delve into areas that are often very rarely discussed, it’s important that we get a complete financial picture of our clients.
Debt Is Not A Dirty Word
One of my neigbours is a builder. He and I often chat when we run into each other in the front of our houses. He has a philosophy about his personal finances that would surprise most people. He is debt averse. In fact, he boasts that he has never owed a single dollar in his entire life. Yet he is relatively wealthy.