Gadgets your budget will love

Many Australian households are feeling the pinch of higher household costs and research shows that most are taking sensible steps to make money stretch further.

To help you get ahead, we’ve rounded up five affordable tech gadgets designed to save you money.

TrackMySpend app

Cost: Free

Investment regulator the Australian Securities and Investments Commission (ASIC) reckons the average Australian household spent $1290 each week on general living costs in 2012. Yet only 54 percent of us know exactly what the money is spent on – that’s scary stuff!

ASIC’s Robert Drake said, “We suspect many households end up misdirecting thousands of dollars each year because they are not keeping track of where their money goes.”

One solution could be ASIC’s free ‘TrackMySpend’ app available on iTunes. Use it to record expenses on the go, set (and stick to) spending limits and find opportunities to save.

nPower PEG Personal Energy Generator

Cost: Approximately $US129.95

Never pay for batteries again. The nPower PEG (personal energy generator) captures and stores the kinetic energy created from walking, with a port that lets you transfer the energy to personal electronics like your mobile phone or MP3 player.

Waterpebble

Cost: Around $19.95

The Waterpebble is a tech toy designed to help you save water. It memorises the length of your first shower, then lets you know when to turn off the tap in subsequent showers with a series of ‘traffic’ lights, progressively reducing the allotted time to encourage shorter showers.

Energy monitoring sockets

Cost: From around $25

Discover which appliances around the home are driving up your energy bill. Just plug an appliance into the energy monitoring socket and see how much power it’s consuming and how much it will cost over a year. Check out some ideas at www.efergy.net.au.

Online comparison tools and calculators

Cost: Free

It’s amazing to think that not so long ago it was almost impossible for consumers to compare the cost of financial products without considerable legwork or phoning around. Online comparison sites and calculators, such as RateCity.com.au, have changed all that, putting purchasing power directly back in the hands of everyday Australians.

RateCity CEO, Alex Parsons said, “RateCity’s comparison tables give consumers fingertip access to the costs, features and benefits of a vast range of financial products. It’s giving all Australians the opportunity to get a better deal.”

When you’ve found the product that’s right for your needs, online calculators show how to get even further ahead. RateCity’s calculators for instance, show how much you could save with additional loan repayments or how much better off you’d be with a higher rate on your savings account.

To compare home loans, credit cards and savings accounts on the market today, visit www.ratecity.com.au.

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Learn more about home loans

How do I refinance my home loan?

Refinancing your home loan can involve a bit of paperwork but if you are moving on to a lower rate, it can save you thousands of dollars in the long-run. The first step is finding another loan on the market that you think will save you money over time or offer features that your current loan does not have. Once you have selected a couple of loans you are interested in, compare them with your current loan to see if you will save money in the long term on interest rates and fees. Remember to factor in any break fees and set up fees when assessing the cost of switching.

Once you have decided on a new loan it is simply a matter of contacting your existing and future lender to get the new loan set up. Beware that some lenders will revert your loan back to a 25 or 30 year term when you refinance which may mean initial lower repayments but may cost you more in the long run.

Savings over

Select a number of years to see how much money you can save with different home loans over time.

e.g. To see how much you could save in two years by switching mortgages,  set the slider to 2.

How much money can I borrow for a home loan?

Tip: You can use RateCity how much can I borrow calculator to get a quick answer.

How much money you can borrow for a home loan will depend on a number of factors including your employment status, your income (and your partner’s income if you are taking out a joint loan), the size of your deposit, your living expenses and any other debt you might hold, including credit cards. 

A good place to start is to work out how much you can afford to make in monthly repayments, factoring in a buffer of at least 2 – 3 per cent to allow for interest rate rises along the way. You’ll also need to factor in additional costs that come with purchasing a property such as stamp duty, legal fees, building inspections, strata or council fees.

If you are planning on renting the property, you can factor in the expected rental income to help offset the mortgage, but again it’s prudent to add a significant buffer to allow for rental management fees, maintenance costs and short periods of no rental income when tenants move out. It’s also wise to factor in changes in personal circumstances – the typical home loan lasts for around 30 years and a lot can happen between now and then.

What is a guarantor?

A guarantor is someone who provides a legally binding promise that they will pay off a mortgage if the principal borrower fails to do so.

Often, guarantors are parents in a solid financial position, while the principal borrower is a child in a weaker financial position who is struggling to enter the property market.

Lenders usually regard borrowers as less risky when they have a guarantor – and therefore may charge lower interest rates or even approve mortgages they would have otherwise rejected.

However, if the borrower falls behind on their repayments, the lender might chase the guarantor for payment. In some circumstances, the lender might even seize and sell the guarantor’s property to recoup their money.

How do I take out a low-deposit home loan?

If you want to take out a low-deposit home loan, it might be a good idea to consult a mortgage broker who can give you professional financial advice and organise the mortgage for you.

Another way to take out a low-deposit home loan is to do your own research with a comparison website like RateCity. Once you’ve identified your preferred mortgage, you can apply through RateCity or go direct to the lender.

What is breach of contract?

A failure to follow all or part of a contract or breaking the conditions of a contract without any legal excuse. A breach of contract can be material, minor, actual or anticipatory, depending on the severity of the breaches and their material impact.

What happens when you default on your mortgage?

A mortgage default occurs when you are 90 days or more behind on your mortgage repayments. Late repayments will often incur a late fee on top of the amount owed which will continue to gather interest along with the remaining principal amount.

If you do default on a mortgage repayment you should try and catch up in next month’s payment. If this isn’t possible, and missing payments is going to become a regular issue, you need to contact your lender as soon as possible to organise an alternative payment schedule and discuss further options.

You may also want to talk to a financial counsellor. 

How often is your data updated?

We work closely with lenders to get updates as quick as possible, with updates made the same day wherever possible.

Mortgage Calculator, Repayment Type

Will you pay off the amount you borrowed + interest or just the interest for a period?

Remaining loan term

The length of time it will take to pay off your current home loan, based on the currently-entered mortgage balance, monthly repayment and interest rate.

Why was Real Time Ratings developed?

Real Time RatingsTM was developed to save people time and money. A home loan is one of the biggest financial decisions you will ever make – and one of the most complicated. Real Time RatingsTM is designed to help you find the right loan. Until now, there has been no place borrowers can benchmark the latest rates and offers when they hit the market. Rates change all the time now and new offers hit the market almost daily, we saw the need for a way to compare these new deals against the rest of the market and make a more informed decision.

What is a debt service ratio?

A method of gauging a borrower’s home loan serviceability (ability to afford home loan repayments), the debt service ratio (DSR) is the fraction of an applicant’s income that will need to go towards paying back a loan. The DSR is typically expressed as a percentage, and lenders may decline loans to borrowers with too high a DSR (often over 30 per cent).

Why is it important to get the most up-to-date information?

The mortgage market changes constantly. Every week, new products get launched and existing products get tweaked. Yet many ratings and awards systems rank products annually or biannually.

We update our product data as soon as possible when lenders make changes, so if a bank hikes its interest rates or changes its product, the system will quickly re-evaluate it.

Nobody wants to read a weather forecast that is six months old, and the same is true for home loan comparisons.

What is a construction loan?

A construction loan is loan taken out for the purpose of building or substantially renovating a residential property. Under this type of loan, the funds are released in stages when certain milestones in the construction process are reached. Once the building is complete, the loan will revert to a standard principal and interest mortgage.