Are you paying too much on loan repayments Its time to check by lindash


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                                                                                                                                                                                                                           NEWS               ISSUE 1, 2007

It’s time to check your                                           Fastest growing – because we                                                                                                                             Are you
insurance                                                         do it right                                                                                                                                              paying too
Is your property adequately insured?                              The Mortgage Gallery is one of the fastest growing franchises                                                                                            much on loan
Construction costs have skyrocketed over the past three years.
                                                                  in Australia, according to BRW (25 January 2007).
In some parts of Australia, costs have risen much faster than     The BRW survey, which focused on what it called “the 60
inflation (as measured by the Consumer Price Index). If you       hottest franchises”, ranked growth three ways: by revenue,                                                                                               As household costs rise, don’t
had to replace your buildings, it might cost a lot more than      number of outlets and by service.                                                                                                                        you wish you could spend a
you realise.                                                                                                                                                                                                               little less on interest payments?
                                                                  The Mortgage Gallery is ranked the 7th fastest growing service
                                                                  franchise.                                                                                                                                               The fact is, you probably can.
                                                                                                                                                                                                                           Many people pay more interest
                                                                  The only mortgage broker in the BRW’s top 50 list is The                                                                                                 than they need to.
                                                                  Mortgage Gallery, ranked 11th fastest growing franchise by
                                                                  number of outlets.                                                                                                                                       Bringing debts together into
                                                                                                                                                                                                                           one loan can reduce overall
                                                                  By revenue, The Mortgage Gallery was the 25th fastest                                                                                                    costs. Loan products change
                                                                  growing franchise. It was one of only two franchise groups in                                                                                            constantly, too, so new
                                                                  the finance and insurance sector to make the top 60 list, and                                                                                            products coming onto the
                                                                  it had the higher ranking.                                                                                                                               market may give you a better
                                                                  “These results reflect the commitment by members of
                                                                  The Mortgage Gallery in a very strong sector where the                                                                                                   If you have a mix of loans
                                                                  competition covers such a wide range of business categories,”                                                                                            – such as a home loan,
                                                                  said John Bignell, the group’s founder and Managing Director.                                                                                            investment loan, personal
                                                                  “The controlled growth plans of The Mortgage Gallery will                                                                                                loan for a boat, car or HECS
                                                                  continue during 2007.”                                                                                                                                   – perhaps it’s time to see if you
                                                                                                                                                                                                                           can consolidate them.
A recent report by ASIC suggests that 81 per cent of home         The franchise sector                                              Borrowing … for busy                        “With The Mortgage Gallery, it was
                                                                                                                                                                               Shane following me up! He got our           Talk to us about all your debt
owners are under insured by more than 10 per cent.                According to the BRW report, the franchise sector represents
                                                                  14 per cent of the Australian economy.                            families                                   application for finance through the
                                                                                                                                                                               bank with ease. It was a highly efficient
                                                                                                                                                                                                                           – we’ll see if there’s a way to
                                                                                                                                                                                                                           help you pay less interest.
Under insurance is a combination of a number of factors
including:                                                        In 2006, there were 960 business-format franchises in             When you run a busy small business         process – the smoothest transaction I
                                                                  Australia, with 61,680 franchise units. Sales turnover for the    from home and have three children          could ever imagine.                         Interest that households pay on
n Insurance firms that rely on clients to estimate replacement    entire sector in 2005 was estimated at $128 billion.              to care for, how do you make time                                                      debt is rising. According to a
  cost of their home.
                                                                                                                                    to sort out loans and other financial      “My husband leaves home by seven            survey by the Australian Bureau
                                                                  Step aboard                                                       arrangements?                              in the morning and is often not home        of Statistics of household
n Failure to account for increasing construction costs.           Why don’t you take advantage of The Mortgage Gallery’s                                                       until 6.30 in the evening. That makes it    spending in NSW, interest
                                                                  successful service model?                                         Tracey Arnett has the answer. She          very difficult to deal with lenders that    on debt rose to 9.3 per cent
n Insurance replacement cost valuations that under estimate
                                                                                                                                    went to Shane Abbott at The Mortgage       work to standard office hours. Shane        in 2005 from 5.8 per cent in
  the value.                                                      To join the team as a franchisee, contact Executive Director      Gallery when she and her husband           delivered papers to our home for us to      2000.
                                                                  Ryan Dhue on 1300 888 89.                                         wanted to arrange finance to purchase      sign. He would drop by in the evenings if
Insurance companies place the risk of under insurance
                                                                                                                                    an investment property.                    necessary.
on home owners when they require them to estimate full
                                                                                                                                                                                                                           ALSO INSIDE
                                                                                                                                    “We run our own electrical business and    “Even while he was on annual leave, he
replacement cost of their home. The majority of property          At particular risk are strata owners who accept that the annual                                                                                          n   HeartKids Teen Camp
owners don’t have the skills to estimate this accurately. Home
                                                                                                                                    it doesn’t leave much time in the day,”    touched base with me to make sure I felt
                                                                  building replacement insurance is an adequate measure of full
                                                                                                                                    said Tracey, who has three children aged   that things were running smoothly.          n The language of business
owners may pay too high a premium if they over insure or, in      coverage.
                                                                                                                                    from 5 to 11.                                                                          finance
the event of property damage, can leave themselves exposed
                                                                                                                                                                               “The other great thing was that he
to extra costs if they are under insured.                         It may be worth asking a licensed valuer to do a full valuation                                                                                          n   Why do you need a broker?
                                                                                                                                    “Shane did everything. It was all done     explained everything in layman’s terms.
                                                                  that shows the costs of replacing buildings on your property.
While construction costs are rising rapidly, if insurers simply
                                                                                                                                    for me. The last time I borrowed from a    He made it all easy to understand.”
adjust initial replacement costs, they may leave the property
                                                                                                                                    bank, I had to follow them up at every
                                                                  After all, adequate insurance is a great way to protect your
under insured and the homeowner at risk.
                                                                                                                                    step. It was such a slow process.

HeartKids Teen Camp                                                                Just for the Record                                                The language of business finance                                                                      and shopping and conference facilities.
                                                                                                                                                                                                                                                            An exclusive business club will offer a
                                                                                                                                                      When property developer William Chan negotiated to purchase prime real estate in                      haven for local, interstate and international
“On the 25th of January, 80 HeartKids and friends arrived at Portsea Camp          Health insurance                                                                                                                                                         commercial vIPs to meet, rest, dine, be
                                                                                                                                                      Hornsby in New South Wales, he needed more than a good finance broker. He needed
for a weekend of adventure and fun. At least that is what we were told it was      Just over half of all Australians had private health
                                                                                                                                                      someone who knew their way around the finance industry in two languages: English                      entertained and do business.
going to be, and I will be the first to say that it certainly was!”                cover in 2004-2005, according to the Australian
                                                                                                                                                      and Chinese.
                                                                                   Bureau of Statistics, with 38 registered insurers.
                                                                                                                                                                                                                                                            William said he would recommend Lily’s
So begins 17 year old Ben Byrne’s account of a four day event for HeartKids
                                                                                                                                                      William first came to Australia in 2000 and is learning English. But he felt his vocabulary           services.
from around Australia.                                                             60 per cent of people aged 45-64 have private
                                                                                                                                                      in financial matters was not strong enough to take him through a major property deal
                                                                                                                                                      without help.                                                                                         “I have lots of friends in business. They are
                                                                                                                                                                                                                                                            the same as me, new migrants to Australia.
                                                                                   But insurers do carry risk: 49 per cent of people
                                                                                                                                                      Through his wife, he met Lily Ng from The Mortgage Gallery’s Sydney CBD office, who                   I trust Lily and I think that is very important
                                                                                   classed as overweight have private cover – as do a
                                                                                                                                                      acted as interpreter and broker.                                                                      to all business people.”
                                                                                   third of smokers and more than half of those with
                                                                                   arthritis and diabetes.
                                                                                                                                                      “As I am a new migrant from China and
                                                                                                                                                      don’t quite understand how the mortgage
                                                                                   SOURCE: BRW 6 DECEMBER 2006
                                                                                                                                                      market works in Australia, I needed Lily’s
                                                                                                                                                      help,” William explained.
                                                                                   4.2 million Australians are expected to be obese
                                                                                                                                                      “Lily can speak both languages and is
                                                                                   by 2025.
                                                                                                                                                      experienced in the finance industry. She
                                                                                                                                                      explained to me the features of the loan
                                                                                   Obesity cost Australian business an estimated
                                                                                                                                                      products so that I could decide which was
                                                                                   $1.7 billion in 2005, in lower employment rates,
                                                                                                                                                      the most appropriate.
                                                                                   absenteeism and associated costs from premature
The HeartKids enjoyed water and land-based activities such                         death (such as earlier-than-expected recruitment
                                                                                                                                                      “The most important thing a client expects
as snorkelling, canoeing, flying fox and a giant swing.                            costs)
                                                                                                                                                      when using a mortgage broker is that they
                                                                                   SOURCE: BRW 8 OCTOBER 2006                                         can find the client the right loan product.
“Those who braved this dreaded design of madness
                                                                                                                                                      Lily did that for me.”
suffered almost a 20 meter drop straight towards the
                                                                                   e-tail therapy
ground before they were caught by the harness,” said
                                                                                   Online shopping (e-tailing) hasn’t been around long                William was so pleased with Lily’s work that
Ben, describing the giant swing.
                                                                                   but it has quickly established a firm foothold in the              he returned to her for help as he began
                                                                                   world of commerce.                                                 preparing for a major development at
But it wasn’t just fun and games. “There were definitely some beneficial parts
                                                                                                                                                      Sydney’s Chatswood. The proposed Wija
to the camp,” Ben commented. New friends were made and old friends were
                                                                                   e-tailing turned over $5 billion in 2000, and it’s now             Plaza includes a hotel, serviced apartments
able to get back together and share a good time.
                                                                                   turning over more than $14 billion.

At an information session, participants learned about obtaining a Medicare card
and seeing a doctor without a parent – useful for older HeartKids like Ben.
                                                                                   Forty per cent of online spending is for items                     Why do you need a                                redraw facilities and off-set accounts. It is
                                                                                                                                                                                                       features like these that can be invaluable
                                                                                                                                                                                                                                                            most situations there’s a specific product or
                                                                                                                                                                                                                                                            feature to suit.
                                                                                   available from conventional retailers, such as music,

The Mortgage Gallery is extremely proud to support HeartKids as our charity
                                                                                   books, clothes and computer programs.                              broker?                                          in mortgage reduction and wealth building
                                                                                                                                                                                                       strategies.                                          There are some attractive introductory rates
of choice. HeartKids supports families of children with heart disease and raises   SOURCE: BRW 22 NOvEMBER 2006                                       The world of lending has changed                                                                      on the market, but it’s important to be
funds for research. Heart disease is the single largest killer of children aged                                                                       dramatically over the last twenty years.         Some people are motivated to repay                   clear on what rate the loan will revert to
under 12.                                                                          Mobiles still rising                                                                                                their mortgage early, whereas others                 after an introductory discounted period and
                                                                                   There were 4,500 plans for mobile phones on sale                   There are now so many different types            are borrowing for investment purposes.               how long you are locked in.
                                                                                   in 2006, up from 2,200 the previous year.                          of lenders and loan products to choose           Breaking a loan term can be expensive, and
                                                                                                                                                      between.                                         there can be additional lender fees and      Take time to find the right loan from the
                                                                                   Six million mobile phones were sold in Australia                                                                    charges.
                                                                                                                                                                                                                   Number of loans available through considering a loan, talk
                                                                                                                                                                                                                                                    outset. If you are
                                                                                   up to October 2006, and another million were                       A professional broker can help you pick                                The Mortgage Gallery Finance Manager at The Mortgage
                                                                                                                                                                                                                                                    to your
                                                                                   imported for Christmas.                                            your way through the maze and choose a                         Number of loans available Gallery first.
                                                                                                                                                                                                       Home loans are specialised these days – for through
                                                                                                                                                      product that suits your needs.                                          The Mortgage Gallery
                                                                                   SOURCE: BRW 22 NOvEMBER 2006
                                                                                                                                                      And it’s not just about the interest rate.
                                                                                   Internet facts                                                                                                                                     26
                                                                                                                                                      In fact, picking a loan based solely on the                                                                               310     Number of
                                                                                   Statistics prove what we all know: the internet                    interest rate can end up costing you more                                                                         310             loans available
                                                                                   is growing. By September 2006, there were                          in the long run. Matching the right loan to                                                                                       through
                                                                                   over 6.65 million active Internet subscribers in                   your needs is vital.                                                                                                              The Mortgage
                                                                                   Australia: 826,000 business and government,
                                                                                   and more than 5.83 million households.                             The lower the interest rate, the lower your
                                                                                                                                                                                                       406 406

                                                                                   SOURCE: AUSTRALIAN BUREAU OF STATISTICS, SEPTEMBER qUARTER 2006.   monthly repayments. But some basic low-
                                                                                                                                                      rate loans can forego certain features, like                                                 27 27
                                                                                                                                                                                                                                                              67   67

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