| Nationals draw down Vaile on loans
The Nationals have re-introduced their on-line loan calculator in a bid to convince voters their mortgage rates would be higher under a Labor government. The move comes on the day the board of Australia's central bank sits down to discuss lifting the official cash rate for the sixth time since the 2004 Federal election. The calculator was introduced during the previous election campaign to show the Coalition's record on interest rates, then at historic lows, and highlighting Labor's record in government. This time around, the calculator is asking borrowers whether they can afford to pay their mortgage under a Rudd Labor government. The calculator provides estimated monthly repayments for loans attracting the current variable home mortgage rate of 8.3 per cent, the averaged standard mortgage rate under Labor governments between 1983 and 1996 which was 12.75 per cent and the highest standard mortgage rate (17 per cent) under Labor.
Complete launches 90% LTV self-certs
Complete Mortgage & Loan Services is launching a range of prime self-cert mortgages from Kensington. The self-cert mortgages are available for mortgages up to 90 per cent loan-to-value (LTV) and start with a three-year fixed-rate deal at 6.89 per cent. Other mortgages in the range include a two-year fix at 6.99 per cent and a two-year tracker at 7.19 per cent. Each product has a £1,999 completion fee that can be added to the loan above the maximum LTV. Keith Street, director of sales at Kensington, said: "2007 was undoubtedly a tough year for the mortgage market, but Kensington is working with Complete Mortgage & Loan Services in providing a really positive start to 2008. "We are delighted to launch these exclusive deals which prove that, even in the current environment, it is still possible to provide competitive high LTV products for customers with specialist circumstances." He added there were limited funds available for the self-cert mortgages products, but Kensington would continue to work with its distribution partners to find solutions to meet the needs of borrowers.
Fed's rate cut may be a boon for borrowers
Lowered loan payments are expected for many Americans in the near future as borrowers begin to see the effects of the Federal Reserve Board rate cut made last week. This stimulus should create greater savings on loan payments ... and a little extra money, the government hopes, to spend elsewhere. As interest rates fall and Congress debates ways to stimulate the economy, Americans are left to decide what to do next: spend the extra money that they are saving from lower interest rates, or stash it away for what believe is an impending recession. As the economy gets a jump start from the lowered federal funds rate cut, which was slashed three-quarters of a percentage point to 31/2 percent Tuesday, borrowers are reassessing their current situations. One immediate result was an onslaught of customers calling their lenders to lock in lower mortgage rates.
Why foreign funds are selling now
Crippled in their home country—the United States--foreign institutional investors (FIIs) continue to push the panic button in emerging markets. The result: global fund managers are selling in one of the most profitable markets – India-- to reduce losses caused by the sub-prime mortgage crisis, which is now spreading to bond insurance companies in the US. Salomon Smith Barney, Merrill Lynch, Morgan Stanley and UBS are among the foreign investors that have sold big time in India, sources said. “The sharp cut in the fed rate by 75 basis points may slow down the process, but the trend may revive sooner than later as we are not out of the woods," market observers said. In the immediate future, FIIs are expected to make net investments in India after as they did after the September Fed cut, but it is difficult to hold on, given the current global scenario, they add. FIIs have sold a net amount of Rs 20,225 crore worth of shares in January.
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