Hi everyone, I am hoping someone here can point me in the right direction regarding how to add my name to my spouse's property and loan, and put my cash savings into an offset account. We don't understand a lot of what our bank manager has told us about how to proceed. Apologies in advance if I don't make a lot of sense myself!!
She - FHO purchase in early 2009. Purchase price $345k, borrowed $265k, currently owes $215k.
Me - $115k cash.
We live in the ACT and want to add my name to the title and mortgage. Following that, we want to park my cash in an offset account and pay as much as possible into the offset account so that we own the property outright in 12-18 months from now.
We have been to see our bank manager on three occasions in the past three months and he hasn't been able to clearly communicate what we need to do in what order, and what fees and charges we're up for. We really want to understand how much this is going to cost us before going ahead with it.
So far our actions/ advice received are:
1. We have submitted a Title Transfer form to the ACT office of regulatory services/ACT revenue office and paid the concessional stamp duty of $20, with consideration being 'love and affection'.
2. The bank manager says we now need to go and see the bank's preferred solicitor and provide them with our stamped Title Transfer form. The solicitor will then prepare a Variation to Mortgage form. Both documents will be lodged with the ACT Land Titles Office. Processing fees will be $99 and $201 respectively and the solicitor will charge us a fee of $110.
3. The bank will offer/provide us with a new loan for $250k. (250k so we get a loan with more features/ options/ interest rate discount etc)
4. Her existing loan has a deferred establishment fee of $1000 if the loan is paid out or refinanced within the first three years. 3 years will be up in March 2012.
5. The new loan has an establishment fee of $300.
6. In order to partially offset the above two fees of $1300, the bank will offer an 'introductory rate' of 1.25% off the variable rate for the first 12 months of the new loan. The new loan has a standard variable rate of 7.82%, a standard discount of 0.65% for loan amounts >250k, and an additional 0.60% introductory rate discount for the first 12 months.
7. Effectively, we will be paying an introductory rate of 6.57% for the first twelve months, in which we plan to pay off the debt.
We believe we are up for the following fees, charges and refinance costs. Have we missed anything? Does this look about right?
Title Transfer - concessional stamp duty - $20
Title Transfer - lodged with ACT land titles office - $99
Variation to Mortgage - lodged with ACT land titles office - $201
Solicitor - $110
Deferred Establishment Fee - on original loan - $1000
Establishment Fee - on new loan - $300
Difference between old interest rate and new interest rate
7.13%-6.57%= 0.56% x 100k = approx $560 saved in interest, if we pay off the balance of $100k in 12 months...
So we will be about $1200 out of pocket to bring my name onto the title and loan and pay the loan off in 12 months. Should we be going ahead with this???
Thanks for your assistance
She - FHO purchase in early 2009. Purchase price $345k, borrowed $265k, currently owes $215k.
Me - $115k cash.
We live in the ACT and want to add my name to the title and mortgage. Following that, we want to park my cash in an offset account and pay as much as possible into the offset account so that we own the property outright in 12-18 months from now.
We have been to see our bank manager on three occasions in the past three months and he hasn't been able to clearly communicate what we need to do in what order, and what fees and charges we're up for. We really want to understand how much this is going to cost us before going ahead with it.
So far our actions/ advice received are:
1. We have submitted a Title Transfer form to the ACT office of regulatory services/ACT revenue office and paid the concessional stamp duty of $20, with consideration being 'love and affection'.
2. The bank manager says we now need to go and see the bank's preferred solicitor and provide them with our stamped Title Transfer form. The solicitor will then prepare a Variation to Mortgage form. Both documents will be lodged with the ACT Land Titles Office. Processing fees will be $99 and $201 respectively and the solicitor will charge us a fee of $110.
3. The bank will offer/provide us with a new loan for $250k. (250k so we get a loan with more features/ options/ interest rate discount etc)
4. Her existing loan has a deferred establishment fee of $1000 if the loan is paid out or refinanced within the first three years. 3 years will be up in March 2012.
5. The new loan has an establishment fee of $300.
6. In order to partially offset the above two fees of $1300, the bank will offer an 'introductory rate' of 1.25% off the variable rate for the first 12 months of the new loan. The new loan has a standard variable rate of 7.82%, a standard discount of 0.65% for loan amounts >250k, and an additional 0.60% introductory rate discount for the first 12 months.
7. Effectively, we will be paying an introductory rate of 6.57% for the first twelve months, in which we plan to pay off the debt.
We believe we are up for the following fees, charges and refinance costs. Have we missed anything? Does this look about right?
Title Transfer - concessional stamp duty - $20
Title Transfer - lodged with ACT land titles office - $99
Variation to Mortgage - lodged with ACT land titles office - $201
Solicitor - $110
Deferred Establishment Fee - on original loan - $1000
Establishment Fee - on new loan - $300
Difference between old interest rate and new interest rate
7.13%-6.57%= 0.56% x 100k = approx $560 saved in interest, if we pay off the balance of $100k in 12 months...
So we will be about $1200 out of pocket to bring my name onto the title and loan and pay the loan off in 12 months. Should we be going ahead with this???
Thanks for your assistance
