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Offer accepted and settlement

John Leov — Sun, 22 Jul 2012 14:30:00 GMT

Congratulations! Your offer is accepted - now you will need to attend to some details within the relevant cooling off period. This varies by state so you’ll need to confirm the dates with your agent or local real estate institute.

If you’ve prepared well, this should be a simple and stress free process. You’ll just need to ensure the right paperwork is in the right hands and make yourself available to sign documents when required without delay. You may need to prearrange a time with your employer or allow time in your calendar to take care of what is needed.

Your conveyancer is your legal representative in the settlement and land transfer process. It is important that you have spoken with the conveyancer you intend to use so that there is no delay when it comes to important tasks such as building or pest inspections, if you are required to have these completed within a cooling off period. You’ll also need to have the companies carrying out the inspections on notice too.

Don’t drive yourself mad trying to interpret the contracts, your conveyancer will ensure they’re in order. They will also conduct the relevant searches of Government and local authorities for anything that may affect the property such as encumbrances or caveats and make necessary enquiries about zoning, titles and rates (council and water).
Feel free to ask questions and learn from the process as you may wish to purchase additional properties in the future so this is a great chance acquire some knowledge.

Another critical party in the settlement process is your financier as they will need to prepare for and arrange the financial settlement. They will also require your timely attention to documents and may need the property to be covered by insurance during the settlement process - again, this varies by state.

Most financial institutions or mortgage professionals will be able to assist you to arrange the appropriate settlement cover and should have discussed this with you in the preapproval stage mentioned earlier in this blog series.

With all of that covered, it’s now time to collect the keys to your new home and move in – welcome home!

John Leov is Manager of Seminar Programs

Working with Real Estate Agents and ‘The Offer’

John Leov — Sun, 20 May 2012 14:30:00 GMT

Most properties are made available for sale by real estate agents, who often get criticised by those buying the house. I can’t help feel that in a lot of cases people simply have the wrong expectations of who the agent is representing and what their job is. They represent the seller and their job is to obtain the most favourable price from the market. In addition to this, in the majority of cases you are not the only potential purchaser and you are competing with a number of others so the price of the property could vary slightly or significantly depending on how desired it is.

Working around these obstacles isn’t difficult if you’ve done your homework (see previous blog post). Have a good idea of what you are looking for and know how much you want to spend. Make sure you talk to a few agents and select one that you feel comfortable dealing with and that you feel will understand what is important to you. They will do some of the leg work in finding potential properties for you and sometimes may offer you a property before it has been listed which will remove any competition from other purchasers.

An experienced agent will also be able to provide you with information around recent and historical sales information and local facilities if you are unfamiliar with the area. Be warned however not to let this replace your own due diligence and always undertake your own research. As you become more serious about a property remember the only silly questions are ones you assume you don’t need to ask. All agents work under a duty of disclosure and must disclose everything they know about a property to a potential purchaser. If they’re unable to provide you with the right information, have them ask the vendor as they have similar obligations.

Once you have found a property you’d like to purchase and you’re confident it fits your needs and budget, it’s time to put in an offer! Your offer needs to be clear and precise, including the timeframe in which your offer expires and any conditions you need addressed such as finance, satisfactory building and pest inspections etc.

Your offer should reflect what you feel is the appropriate price for a dwelling of this size, location and quality. All of your research about the area and past sales history is important. If you are offering below the asking price, clearly explain the reasons for your offer and keep in mind, vendors are under no obligation to give you a second opportunity as there may be competing offers. You will also need to agree on a settlement date - generally between 30 and 90 days is standard. Ensuring the agent is aware your finance is pre-approved and being flexible on settlement date could add weight and may give you an edge against a competing offer.

Purchasing your own home is an exciting process. To ensure you have a positive experience, make sure you put in a quality offer, be clear and firm on conditions and if you wish to negotiate, be well prepared and confident as to what you will and won’t negotiate on and stick to it!

John Leov is Manager of Seminar Programs

Be diligent with credit cards

Peter Evers — Sun, 29 Apr 2012 14:30:00 GMT

Your Money Column

Below is a condensed version of the April column published in The Advertiser. Feel free to let me know if there is any particular topic you would like to hear more about.

Thanks
Peter

Be diligent with credit cards

Credit cards have become so ingrained in today’s society that it’s almost impossible for some people to survive financially without them.

The main advantage of credit cards is they enable people to access instant credit, without immediately impacting on cash flow.

The downside of credit cards is that in most instances, they have a higher interest rate than most other forms of credit and you’re charged interest on all outstanding transactions if you don’t pay your full balance each month.

Credit cards can be a valuable asset in managing your money if you have the willpower to keep them under control.

Keep in mind the following things when thinking of getting one or managing your current one. Try to remain diligent and if possible, pay off your credit card balance at the end of each month or within the interest free period.

If you do accumulate a large balance on your credit card and it isn’t possible to pay off the entire amount, try and make more than just the minimum monthly payments to reduce the amount of interest you pay, and where possible, avoid cash advances as they normally have a higher interest rate.

Try to limit the number of credit cards you have and always get a credit limit that reflects what you can afford within your budget to avoid accumulating multiple credit card debt.

Credit cards can be a valuable financial tool as long as you’re smart about repayments, your credit limit and the type of card you get. If you do find yourself with spiralling credit card debt, consider consolidating it into a personal loan. This ensures you’re bound by forced repayments and prevents you from adding to your debt. But make sure you cancel your credit card so you’re not tempted to repeat past mistakes and create further debt.

Arranging finance and finding a property

John Leov — Wed, 11 Apr 2012 14:30:00 GMT

Finding the right property can be difficult and arranging finance to purchase that property can often be quite a stressful process. To save you some time, I recommend breaking the home buying process down into ‘bite size’ pieces which will hopefully eliminate some stress and heartache along the way.

Establishing what loan amount you can afford to borrow is a good starting point, as this will determine what areas and houses you should be looking at.

One of the best ways to do this is by speaking with a mortgage professional who will be able to discuss the options that different lenders can provide and which one would be best for you. These meetings are generally free of cost or obligation and can usually be done at a time and place that suits you. This will save you time as you will avoid having the same conversation with multiple lenders.

At this meeting you will also be able to establish if you qualify for Government grants or subsidies, how much deposit you will require, what the repayments will be and the amount of money you will need to meet the closing costs (stamp duty, legal fees, insurances, rates etc).

If you are finding it difficult to save for a deposit there are a number of other options you could discuss with your lender – for example the option for parents to assist their children with the purchase by using equity from their property, or purchasing the property with a parent, family member or friend.

Once you have the finance box ticked, you can shift your focus to identifying available properties that fit your financial criteria. Two of the easiest and more efficient ways to search for properties is through internet searches and by speaking with real estate agents.

Internet searches will give you a quick feel for the average price of properties in certain areas or suburbs and may narrow down your search criteria. Some may have information such as how long properties have been on the market, sales history for the area including trends in growth of property values. If you are purchasing a new home you might want to think about how far along the development is and whether prices have already increased considerably as you don’t want to end up paying for someone else’s profit.

Think about how long you intend to live in this property and whether your needs may change in the future, for example if you’re thinking of having a family. Once you have a short list of properties you’re interested in, try to visit them at different times of the day and night to get a better feel for the area, noisy neighbours, traffic etc. The street outside my first home went from a leafy quiet street on a Saturday to a highway from Monday to Friday.

If the first property is simply a stepping stone into the market you will need to consider whether it will sell well in future and has the potential for growth in value.

Next month we will look at working with real estate agents, the offer process and some key things to consider if you’re buying an existing home.

Avoiding a nasty first home experience

John Leov — Wed, 29 Feb 2012 13:30:00 GMT

My first home purchase was an experience that I wouldn’t readily wish on others. The good news however, is that most of the mistakes would have been simple to avoid with a little more education on the process and the people involved.

There are three key things that I think we all want to get right when we buy our first home, and they are:

1. To buy a well-constructed, good quality property
2. To avoid being railroaded in the negotiation process
3. To get through with as little stress as possible

Thinking back, my wife’s young sister running up to the Real Estate Agent shouting “they want to buy the house” may not have helped the negotiation process.

Over the years I’ve met a lot of people playing the eternal waiting game, hoping that some mystical sign would appear before them saying now is the right time to buy. In reality, the right time is when you are prepared, can afford it and favourable market conditions exist, such as low interest rates and softening house prices. To that end, the current market certainly matches both of those conditions.

Over the next few months I will be providing further detail and insight around the various steps in the first home buyer process. So keep checking back on a regular basis, and if you have any specific questions you’d like answered, let me know and I’ll try and give you some guidance.

We also hold information nights throughout the year which provide an excellent way to make sure you’re aware of all the options. Visit http://www.peopleschoicecu.com.au/seminars to find one near you.

If you have prepared well, then the time is most likely right – goodluck!

John Leov is Manager of Seminar Programs

What do the equity markets know that the politicians do not?

Luke Havelberg — Mon, 13 Feb 2012 13:30:00 GMT

Much has been said (by politicians and economic commentators alike regarding the performance and resilience of the Australian economy throughout the turmoil of the global financial crisis and subsequent European sovereign debt crises. In particular, the relatively low level of unemployment experienced in Australia and the fact the Australian economy did not officially reach recession status at any stage over the past four years (a recession being two quarters of consecutive negative GDP growth).

While politicians continue to tell us that Australia is the envy of the western world when it comes to economic performance and management, it would seem the performance of the Australian share market throughout the same period tells a different story.

As a general theory, the share market should reflect the state of the economy given share market performance is broadly based upon the profit expectations of the companies that form the share market. Companies tend to make larger profits through economic good times and lower profits through economic downturns. Therefore the higher the expectations for future company profits (due to the expected performance of the economy), the higher the markets should push.

Let’s look at the performance of the US equity market versus the Australian equity market over the past five years. To assess the performance of the Australian market we will use the ASX200 index which tracks the movement of the top 200 companies of the Australian share market. For the US market we will use the S&P500 which tracks the movement of the top 500 companies of the US share market.

Chart 1 details the dramatic drop (52% decline) in the share market from October 2007 to March 2009, as well as the subsequent rally to March 2010. Using the monthly closing price for analysis, the chart reveals that the Australian market has rallied 50% off its March 2009 low. The equivalent rally of the S&P500 has been 86%, a significant out performance when compared to the Australian market.

Chart 1: S&P/ASX – Monthly Line Chart

Chart 2: S&P 500 Cash – Monthly Line Chart (Close)

Why is there a large variation in equity performance despite the strong performance of the Australian economy when compared to the US economy?

A key reason is the relative performance of the Australian dollar when compared to the US dollar. A strong Aussie dollar makes it harder for Australian companies to compete overseas placing a drag on profit and share price performance. The US has worked extremely hard at depreciating their dollar against other key currencies (very low interest rates coupled with increased money printing helps keep the dollar down) in order to prop up the competitiveness of their domestic companies so as to support jobs growth. To date, this strategy has proved effective when considering share market performance however the flow on impact to jobs growth is only starting to have some traction.

The equity markets know a consistently strong Aussie dollar is not positive for the performance and sustainability of corporate profits. As a result we are starting to see Australian companies cut Australian jobs in order to manage costs and endeavour to maintain their competitiveness against overseas companies. Politicians (and the RBA) should therefore start directing more of their energy at ways to depreciate the Aussie dollar to help our local battlers compete on a more level playing field with their global competitors which is much easier said than done.

Luke Havelberg is the Manager of Treasury Balance Sheet.

Your Money Column

Peter Evers — Thu, 25 Aug 2011 14:30:00 GMT

Your Money Column

In my opinion, you can never receive too much advice when it comes to your money. Have you seen my latest column in Adelaide’s ‘The Advertiser’? Once a month, I express my views and provide advice on various topics relevant to financial services. Below is my latest article published in The Advertiser last week and feel free to let me know if there is any particular topic you would like to hear more about.

Thanks

Peter

Investing when it’s right

Current world events are causing a great deal of uncertainty in financial markets, raising fears that some economies could be dipping into recession. So more than ever, now is a good time to consider your investment options carefully.

Regardless of what the market is doing, there are some basic principles you can follow to ensure your investments are sound and realistic.

Firstly, you will need to determine your appetite for risk and what your expectations are in terms of returns.

High-risk investments are not for everyone. If market fluctuations stress you easily, you may be better off investing in a low-risk option such as a high interest savings account which will protect your capital and ensure you’re able to access your money when you need it.

If you’re comfortable with an unpredictable market, you may be willing to take on a higher risk investment strategy, such as shares, and see it out over a longer period. Of course, this is not without its risks with factors such as inflation eroding the purchasing power of your money or depending on the timing of your decisions to buy, you may be subject to lower returns or loss of capital. Your returns will be much larger though if you manage and monitor your investments correctly.

You will also need to assess whether you have short or long-term goals as this will determine what level of risk you can afford to take. Think about when you’re looking at spending your money. Whether you’re saving for a home deposit or planning your next family holiday, you will need to determine the timeframe in which you will need the funds then look at what you can afford to invest in order to reach your goal within this timeframe.

There is no point investing in high-risk options if your goals are short term as you may suddenly need to access the money when their value is low. High-risk investments are more effective if you can afford to see out the peaks and troughs in the market.

One option that could reduce the time and stress in following the investment market could be to start a managed investment fund. A managed investment fund ensures your money is in the hands of skilled professionals who will invest in many different asset classes and sectors on your behalf to spread out your investment.

This option will offer diversification, convenience and regular distributions with the availability to track your investments online at any time. Even if you are new to the investment market, managed investment funds provide an easy way to gain exposure to investment assets such as shares, property, fixed interest and cash.

Analysts have said the All Ordinaries Index may need between three and nine years to get back to its 2007 record high so when considering your options for investing, you will need to be patient, know your goals and risk tolerance and understand your risk and return in order to develop an investment plan that is right for you.

If you’re unsure about your investment options in the current environment, the best thing to do is talk to a financial advisor – they will be able to look at your financial circumstances and assess what will work for you based on your needs.

People's Choice Rolls Out

Peter Evers — Wed, 10 Aug 2011 14:30:00 GMT

What a busy couple of months we’ve had with a lot of activity packed into June and July. Now that things have started to settle down, I thought I’d take some time to update you on what’s been happening above and beyond ‘business as usual’ at People’s Choice Credit Union.

A modern way of banking

From mid-June, we started opening our new look state-of-the-art branches, the first being at our new Victor Harbor branch, followed by Golden Grove, Port Adelaide and West Lakes. Features at the new branches include coffee machines, coin counting facilities, kids interactive play areas, storage lockers and a community market area – designed to actively involve local businesses and display community news. If you haven’t had a chance to visit one of our new branches, I encourage you to do so as they have a fun, modern feel to them. They certainly offer a new way of banking.

New advertising campaign

As you know, members approved our new name – People’s Choice Credit Union – in late June. From 18 July, we kicked off a new advertising campaign to signal the official launch of the new name. A series of People’s Choice Credit Union ads hit the TV featuring a bald guy with a comb over, a talking baby and a dancing traffic light pedestrian man – all centred around ‘isn’t it nice to have a choice’ – the cornerstone of our new marketing activities.

The response to our advertising has been fantastic, and we certainly hope they’ve not only brought a smile to your face, but started to give everyone a feel for our new brand.

Sit or stand?

Did you get a chance to meet Bev? The friendly Gran who made sure she rewarded good Samaritans with $50 who gave up their seats for her on the busy buses and trams of Adelaide and Melbourne. Sporting a comfy jumper with the words ‘Sit or Stand?’ printed on it, Bev was the feature of one of our strategies to reward people for making the right choice – just as you would be rewarded through lower fees and better products by making the right choice with your banking. Commuters who gave up their seat for Bev were rewarded with a $50 voucher to open an account with People’s Choice Credit Union and if they were lucky, snapped in a shot to feature on our Facebook and Twitter sites.

Choice at your bus stop

I’m sure we’d all agree that waiting for a bus isn’t the most exciting experience and also how uncomfortable those bus shelter chairs can be. So through another marketing activity to emphasise our focus on offering people a choice, we transformed five popular Adelaide bus stop benches with four comfy alternatives – a leather lounge, an office swivel chair, a sturdy kitchen bench and a modern body-moulded chair. Designed simply to give people a bit of a laugh and get noticed – these funky chairs will remain at bus stops for a few more weeks. So which chair would you choose?

Our current marketing campaign was designed to create awareness around our new name and brand – and highlight that we have choice in everyday activities, just as we do with our banking. We’re hoping it will prompt more people to review their current relationship with their financial institution, and hopefully make the choice to move to our credit union.

You’ve made the right choice

Peter Evers — Thu, 07 Jul 2011 14:30:00 GMT

After a lengthy process, we finally have a new name – one we can all feel proud about. People’s Choice Credit Union was approved by members at our General Meeting on 27 June 2011.

The new name is fresh, exciting and will help us take advantage of new opportunities in the marketplace. It highlights the fact that we offer you – our people, real choice when it comes to your financial needs.

Throughout the process, we’ve been completely transparent with members and have involved them at every stage. In many ways, members were the driving force behind the name. People’s Choice Credit Union was, in fact, suggested by many members when we called for name suggestions.

I understand that not everyone will love the name initially, but I’m certain that over time it will grow on you.

So what next for People’s Choice Credit Union?

The future is bright. With the merger, technical integration and new brand preparation behind us, we can now dedicate more time to creating better products and services, offering lower fees, caring for our environment and giving back to the communities in which we live in.

Thanks for your support throughout this time.

Peter

Rocking it out in Darwin

Grant Dolphin — Thu, 26 May 2011 14:30:00 GMT

I wanted to share some photos from this year's People's Choice Credit Union BASSINTHEGRASS music festival. I was up there last weekend and once again it was hugely successful day.

It was about 32 degrees and the Darwin amphitheatre was packed to the brim with 7500 people attending the event. It was great to see another full house as it has been hitting maximum capacity every year for a while now.

We’ve been sponsoring the event for about six years so it’s a great opportunity to spend the day out in Darwin and see the variety of acts and talent who perform and the fashion worn at the event never fails to amaze me.

Our sponsorship with BITG represents our belief about supporting the communities in which we operate and providing opportunities for people to get out and spend time together in a safe environment with live music.

This year was the year of the home made t-shirt as well as various superheros and of course, nothing says party like a bunch of cardboard robots.

The atmosphere was euphoric for the stellar line up including acts such as Art Vs Science getting the crowd pumped for the evening, Bird of Tokyo rocking it out and Sneaky Sound System getting everyone dancing with some new and old songs. The dancing continued until 11pm with The Presets’ electronic dance genre of tunes.

It’s time to make way for a new name

Peter Evers — Wed, 25 May 2011 14:30:00 GMT

The process of obtaining a new name for our credit union has taken longer than we initially expected, but the good news is we are getting closer to putting in place our final branding.

As you may be aware, we will be putting forward our proposed new name – People’s Choice Credit Union – to be voted on at our General Meeting on 27 June 2011. We believe this name will help to deliver significant benefits for our members, staff and communities.

This name truly reflects the personality of our credit union, which is all about members having a choice, a community focus and a personal approach when it comes to our products and services.

Our aim is to differentiate ourselves from the banks, and provide a genuine alternative to them. Our name will play a vital role in helping achieve this.

Through the merger of Australian Central and Savings & Loans in 2009, we created a larger, more easily accessible credit union that was still member-driven and focused on delivering the best service, value and security for all members.

The next step for us now is to put the name through a member vote. We want members to feel proud of the name and know they had a say in its outcome. People’s Choice Credit Union is the way to achieve this.

It’s important to recognise that members actually suggested the name People’s Choice Credit Union. It emerged from the process of inviting members to submit names which took place earlier this year. A number of names then underwent extensive market research and People’s Choice tested very strongly with members and non-members, so we’re confident that this is the right name for our credit union.

We realise that not everyone will like the proposed new name, however, it is virtually impossible to achieve unanimous approval. We would like members to look at it objectively and see it as a business decision, and the benefits that this name will bring for our credit union moving forward.

I want to encourage you to vote for People’s Choice Credit Union at our General Meeting on 27 June or by visiting one of our branches to vote by proxy form and place your vote in a ballot box. Alternatively, you can vote by mail using a proxy form that all members will receive in the mail, and is available on our website also.

Lets make way for a new name and vote yes to People’s Choice.

Peter

Welcome to our new credit union

Peter Evers — Sun, 13 Mar 2011 13:30:00 GMT

It’s been a long journey but here we are and I would like to officially welcome you all to our new blog. With technical integration now complete, we’re operating with a single branch network, one call centre and, as you can see, one website and Internet Banking system.

So in essence, we’re now truly operating as a single credit union. It’s certainly been a huge task from our staff to get us to this point, and I’d also like to recognise our members for their patience and support during the last 18 months.

Of course, there is one piece still required to complete the picture – our new name. The Board is currently finalising a name to be put forward to members for a vote, and we’ll provide more information on this process in the very near future.

Until this happens, we’ve implemented an interim brand consisting of both heritage logos which is a temporary solution to signify that we are operating as one credit union.

As you would be aware, we’ve already introduced some great benefits for members as a result of the merger, including reducing fees and enhancing products, and now that we’ve integrated, all members will be able to take full advantage of the new technology and improved access.

I look forward to keeping in touch with you via this blog which will provide you with the opportunity to talk to me and some our knowledgeable staff members about almost any subject related to our credit union.

People's Choice Credit Union means a larger, more easily accessible credit union yet still member-driven and focused on delivering the best service, value and security for all members.

Peter