Our People – Rochelle Kennedy (Director of Finance)

How long have you been in Finance?

I have been in finance for over 20 years (showing my age 😐)

How have you seen Finance change in that time?

The changes have been significant. When I first started we did hand written applications that we would hand deliver to a bank whereas now we use sophisticated aggregation platforms that link directly to the banks software. So technology has certainly changed things a lot however, the biggest evolution has come with major banking reform and a strong focus on compliance. The banking environment has become more stringent in many ways with banking policy shifting continually requiring a sharp eye, in depth technical knowledge and the need for a higher level of professionalism than ever before

Obviously with Covid that has added another element to lending … what challenges are people facing when applying for finance in the current conditions?

Again, navigating bank policy requires constant attention and focus.  Covid has certainly brought about some real challengers for borrowers. As an example, banks advised that pausing your mortgage repayments would have no adverse effect on your credit history however we now know this is not the case. We are seeing refinance applications declined due to borrowers existing repayments being paused with the banks wanting to see a consistent repayment history of at least 6 months from the time payments are resumed before re-applying.  With this in mind we strongly recommend you don’t pause your mortgage repayments unless absolutely necessary.

If you are receiving Job Keeper plus any bonuses, incentives or commissions lenders will only use the Job Keeper amount as assessable income therefore limiting the amount you can actually borrow. 

So whist the option to pause mortgage repayments and the introduction of the Job Keeper program have been helpful to those experiencing financial difficulty there are certainly challenges that come with that help in terms of borrowing money.

Due to the number of applications currently being presented to the banks and a lot of their staff working from home, the timeframes for approval can also be lengthy so it is important to ensure you have ample time for your finance condition in any purchase contract.

What opportunities are out there for people that are in a position to borrow?

There are a couple of key opportunities for people at the moment. The first being that there has never been a better time in history to pay down your mortgage and increase your equity with interest rates at their lowest point ever.  It’s certainly a time to maximise this opportunity and for those with stable employment you can further capitalise on record low interest rates by looking at the option to purchase an investment property that when you factor in the rental income and tax benefits would be close to a neutral cash flow position. Debt consolidation, debt reduction and further investment are the key opportunities being driven by the lowest interest rates in history. 

There appear to be some great incentives out there for First Home Buyers right now, what advice would you give to someone looking to buy or build their first home?

If you have stable employment and you have a good history of saving and paying bills on time there is a compelling case that now could be the right time. We have the lowest interest rates in history making mortgage repayments comparable to rent on like for like properties. Combining these low interest rates with the first home buyer grant and the government building incentive it creates a very unique opportunity for first home buyers.

If you are looking at buying your first home now makes sure all your accounts are up to date, your repayment history is consistent and close all unnecessary consumer accounts like credit cards and store cards. Try and make regular instalments into a savings account and watch your spending.

Finally, engage a specialist. Whilst friends, neighbours and colleagues advice is well intended you must have a professional team working for you in coordinating the key areas of finance, government incentives and property selection. Your first home is an exciting first step and you want it done right so professional support is a must.