Can you protect property against identity fraud?

A recent news article placed identity theft as the fastest growing type of fraud in Australia with an 80% year on year increase. Worryingly, cases of identity theft have even moved into the property market! It certainly begs the question…

Q. Can you protect property against identity fraud?

Identity theft has the potential to be devastating and financially crippling, however it is not new to our shores. Below we share some alarming Australian examples:

(Not) as safe as houses

Last year, a Canberra woman was embroiled in the court system in an attempt to claim compensation from the ACT government after her house was sold from under her nose without her knowledge!
While she was residing overseas the brazen fraudsters impersonated her, forged her signature and instructed a real estate agent to list her house. They engaged a lawyer to manage the conveyance and directed her bank to discharge her mortgage from the title to her property. The sale proceeds were deposited into a bank account traced to Indonesia.

Despite the fraud coming to light shortly after the sale was finalised, it was too late. The innocent purchasers, who had no involvement with the fraud, were now the registered owners of the title to the land. As a result, they enjoyed the benefits of indefeasibility to title.

Unfortunately, this wasn’t the first time for such an event. In 2010 Western Australia
was the target of choice for fraudsters when a house in Karrinyup was sold without the knowledge of its owner. African based fraudsters successfully impersonated the property’s owner and instructed the property manager to market and sell the home.

In 2011, property owners in Ballajura received a rude shock when they contacted their property manager to arrange an inspection of their investment property4. Their house had been listed and sold by the real estate agency months earlier! Once again, they had fallen victim to the impersonation and fraudulent instructions of fraudsters.

Q. What about compensation?

Unfortunately, for a victim who has had fraud committed against title to their home, seeking compensation for the loss is a long, stressful and expensive road.

Although various jurisdictions have provisions within their laws that allow for compensation to be provided by respective state governments, it is often reserved as the option of last resort. This means that for a victim to be able to claim compensation for the loss of their house they must have explored every other recourse available to them – including commencing available proceedings against the fraudsters themselves! As you can imagine, success is not always guaranteed.

The unsuspecting Canberra fraud victim finally had her day in court – more than two years after the fraudulent sale. She no doubt also accumulated huge legal expenses.

Q. What protection is available?

A title insurance policy provides coverage for home owners against a wide range of property risks, including loss as a result of fraud and forgery against your title. If the home owners mentioned in these case studies had a title insurance policy they would have received comprehensive protection against the loss caused by the fraud.

While risks may be minimised if you currently reside in the property there is no doubt that modern technology has introduced modern risks. Taking steps to minimise risk is becoming essential for all of us in today’s world.

If you would like more information on title insurance…

CALL THE OFFICE TODAY for an introduction to our insurance specialist. What a great opportunity to review ALL your insurance needs!

Time to Refinance?

Nearly half of all homeowners have NEVER refinanced!

Are you one of them?

A recent survey of Australian mortgage holders found 45% had NEVER refinanced their home. The report also found customers who DID refinance saved an average of $240 per month ($2,880 pa) by refinancing a 30 year loan.

What would YOU do with an extra $240 each month?

Why consider refinancing?

You no doubt know the cash rate set by the Reserve Bank of Australia (RBA) is at an all-time historical low. In turn, most lenders are offering the lowest home loan rates EVER seen.

So… If there are potential savings in the wings WHY do so many home owners neglect to explore if refinancing their home loan may benefit them?

Well apparently we dislike talking about money!

It is interesting that another recent survey found 42% of Aussies claimed they would rather avoid the topic of money. Is this a coincidence? Even religion, politics and sex came higher up the list of preferred topics! I

In fact, one in three home owners don’t even know their home loan rate.

YES! That’s one third of us!!

Let’s be clear – any decision to refinance should NOT be based solely on a lower interest rate. As your finance specialist we will consider your individual circumstances to determine if refinancing is suitable for your situation. Gone are the days of making minimum repayments at a similar interest rate over 25-30 years. It is recommended you review your home loan every two years.

Times change. Our needs change, our income and expenses change. Loan features change!

So what ARE some of the reasons nearly half of us have never refinanced? Research shows:

54% of borrowers claim to be happy with their lender.

That’s valid. But then most people only receive information from THEIR lender. They can be unaware the market is now very competitive and other lenders or loans COULD provide greater benefits. And it’s not just about rates – many loans offer features such as offset accounts and redraw facilities that could be right for you. Or perhaps your loan includes a feature (with monthly fees) that you no longer use?

24% said they couldn’t find the time for all that paperwork.

This is where your finance specialist comes to the fore – we do most of the legwork for you. The process could be much easier than you think!

13% think it would cost too much

Exit fees were banned for all loans originated after 30 June 2011. If your loan originated prior to this you will need to find out if an exit fee applies. Ask us!

However a new lender will often pay the exit fee for you when refinancing with them. Other fees may also apply – these will also be assessed to determine if refinancing delivers an overall benefit.

9% think it is too hard to compare loans

Comparison of a range of loans across multiple lenders is one of the key advantages of using a finance specialist. We aren’t tied to any one lender. Your current lender would only look at alternate loans from their own range of products.

What are the benefits?

We’ve plugged in some numbers – see the table below – based on an average mortgage of $380,320 at the average interest rate of 5.22%.

If you refinanced at today’s average variable rate (4.64%) you would save $134 per month ($1,608 pa). At today’s average 3 year fixed rate (4.38%) you would save $193 per month ($2,316 pa) – and then most likely revert to the variable rate. These savings could provide much needed financial breathing space.

Alternatively, if you maintained your current repayment level this would deliver substantial interest savings and reduce your loan period by 4-5 years – see the last two columns! What difference would this make to YOUR life as a mortgage holder?

So… Is it worth exploring the possible benefits of financing after all?

Based on $380,320 average mortgage at 5.22% average interest rate (30 year loan)*

Interest rate 5.22% Monthly repayment $2,093.00 Total interest paid (30 yrs) $373,189 Interest saved @ reduced repayment level $0.00 Interest saved @ $2093^ $0.00 Time to repay loan @ $2,093 pm 30.0 years

Interest rate 4.64%**% Monthly repayment $1,959.00 Total interest paid (30 yrs) $324,845 Interest saved @ reduced repayment level $48,344 Interest saved @ $2093^ $95,825 Time to repay loan @ $2,093 pm 26.2 years

Interest rate 4.38%*** Monthly repayment $1,900.00 Total interest paid (30 yrs) $321,264 Interest saved @ reduced repayment level $51,925 Interest saved @ $2093^ $128,278 Time to repay loan @ $2,093 pm 24.9 years

 

Taila Sullivan – Congratulations! Better Business Awards NSW 2018 Finalist!

We are very proud that Taila Sullivan of Indigo Finance has been shortlisted as a finalist to win in the Best Loan Adminstrator category at the 2018 Better Business Awards, partnered by NAB and hosted by The Adviser, Australia’s top publication for Australian mortgage and finance brokers.

Now in its fifth year, the annual Better Business Awards recognises individual and group excellence across 18 award categories. Winners in the individual categories will be automatically considered for the coveted Broker of the Year Award. In addition, Taila Sullivan will be in the running for the Editor’s Choice Award, which recognises an individual’s outstanding contribution to the broking industry.

“This year the calibre of submissions was as high as it has ever been, a true reflection of the strength of the mortgage broking industry right now,” James Mitchell, Momentum Media’s managing editor of mortgages, said.

Many of our clients and partners will have had the pleasure of working with Taila and know this achievement comes well deserved! Well done to Taila on all her hard work and dedication to a clients needs and ensuring an amazing experience.  

The winners will be announced at the state award dinners between 15 February and 15 March 2018. Good luck Taila!