One in every three “Gen Y”s are claiming that they cannot afford to purchase a home loan without the help of their family, whilst one in every five parents who are close to retirement anticipates pitching in order to help their children achieve the great Australian housing dream.

The results have sparked fears that there may be an increase in family clashes over finances.

Many feel that Baby Boomers have enough to worry about without added concerns about using their super to help their children buy their first home. Experts advise that parents should think twice before making such a commitment in an unstable economic environment, as it may simply drive each generation further into debt.

General advice is that if you can’t afford the mortgage, whether you are the parent digging deep in your pocket or the child who needs assistance, it is sensible to consider your options and be realistic about your finances.

Recent months have seen a decrease in first home investment due to affordability concerns and anxiety over interest rates and the condition of the global economy.

It appears that half of all Australians under the age of 40 who are planning to apply for a home loan in the next couple of years are single, residing in a shared home or still living with their parents.

Borrowers opt to refinance to get a better loan deal that offers better interest rates. This way, they can save more funds that the can devote to other expenses such as renovations or buying other properties for investment. As the loan picture of Australia is diverse, finding the best home loan entails research.

Many are tempted to switch loans if they find new deals offer better rates. However, it is important to remember that refinancing entails exit and entry fees that can be costly. The average loan length is between 3.5 to five years, it is advisable to review the terms of an existing loan first before refinancing.

A variable home loan allows you to make extra repayments, though the risk of interest rate hikes depends on the official cash rate of the Reserve Bank of Australia. Meanwhile, fixed home loans offer repayment stability but extra repayments are not usually allowed.

If you are interested in refinancing your home loan it is important that you seek the advice of a loan adviser, with the right advice could save you much time and money. Refinancing your home loan could ensure you get the best deal available to you that may better suit your lifestyle and financial needs.

The different terminologies used in mortgage arena have always perplexed the people in to it. The following glossary section about different terms used in mortgage business will help you understand the business better. It is very essential to have the basic awareness about the different mortgage terminology, as it could help you avoid misunderstanding the jargons used. Do check out the mortgage terminology list given below.

Adjustable-Rate Mortgage (ARM) – A kind of mortgage loan wherein the rate of interest periodically changes, which depends on the changes in the economy.

Amortization – It is a method of loan repayment wherein the amount borrowed would be repaid in installments for a particular period of time.

Annual Percentage Rate (APR) – It is the gross annual cost of the mortgage, which includes the interest rate, points and different charges which are payable on the loan.

Balloon mortgage – It is a mortgage terminology used for a mortgage loan which requires fixed and low monthly payments for a short period of time.

Buy-down – This particular tool will allow you to bring down the interest rate on your mortgage loan fixed rate for a short period, which is usually for one to three years.

Cash out refinance – This is a kind of refinancing a mortgage which is done at a higher amount than the balance on the current loan. By this you can use the additional money for personal use.

Fannie Mae – It is a mortgage terminology used to indicate the government-sponsored enterprise (GSE) which is chartered by Congress and it is also the largest home mortgage funds supplier in the U.S.

Foreclosure – It is a legal process in which the borrower is dispossessed of the right to own his property when he fails to pay back the amount of loan.

Home equity line of credit – A kind of mortgage loan which can be taken out to support your

financial needs by using home equity as a loan security.

Points – Points used to lower the rate of interest to a considerable amount by paying points on the mortgage loan.

Refinance – This is the process through which you can pay off an existing loan while keeping the same property as security by taking a new loan.

By Mortgage Community