Cashless Deposits - A Property Buying Secret known to Banks, Finance brokers & Agents

Easier to carry than cash

MADMENINX / Via finance.ninemsn.com.au

" If used properly, deposit guarantees (bonds) are an efficient way of securing the house of your dreams before you receive the funds from the property you are selling. Effie Zahos ( money magazine) reports.

It's not unusual for financial products to hit the market with a sales pitch that sounds too good to be true. It usually is, but sometimes the promises are real. This is the case with deposit bonds.

In Brief :

* Deposit bonds remove the need for property buyers to pay a cash deposit at the time contracts are exchanged.

* While these products are an innovative way of breaking into the property market, deposit bonds, if they are misused, can be dangerous.

* Deposit bonds may replace the need for a cash deposit, but they do not remove your obligation to pay the full deposit and purchase price at settlement.

* Purchasers like them because they keep their cash until settlement. Vendors accept them because they act as a financial guarantee. That is, the bond gives the vendor security that should, for whatever reason, the purchaser not proceed with settlement on the property, the bond can be converted to cash.

* The cost of a deposit bond is based on the value of the property and the length of time to settlement. It can also vary between underwriters and agents. At the very least you can expect to pay around 1% of purchase price. It's a one-off fee that's usually partly refundable if you don't use it."

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Money Magazine published the above article in 2003 , Deposit Guarantees - a product which delivers what is promised has since then held true and thus far nearly 1,000,000.00 houses bought using Deposit Guarantees is and should be a testament itself.

It has been a secret " Tool " for the finance Industry, so unless you were in Banking , Finance Broking , Conveyancing or just a property buying genius you may not have known what a Deposit Guarantee is or its usefulness in the art of buying & / or selling in the property market.

But word is getting out ... ;

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In today's busy culture, there is a constant demand for quick outcomes to satisfy the ever growing consumers with instance access to products and services as quick and efficiently as possible

The housing market is no different, fuelled with rising incomes, low lending rates & high lending margins there is an instant and rising demand for housing everyday, which means that people are in constant buying mode - first in best dressed in many situations, no more future planning over a 12 month period, it's now a matter of days before someone decides I want to buy a house

Enter The Deposit Bond ;

Via google.com.au

Resourcing a deposit in a short space of time is difficult, even if you have your loan approved or house sold or money in fixed deposits, everything takes time.

Enter the Deposit Guarantee, within 24 hours one can get a Deposit Guarantee issued and jump into the housing market without waiting for the bank to give you the money for a Deposit, or waiting to sell your current house, shares, gifts, inheritance etc....

In Australia, every Major bank can issue Deposit Guarantees (Deposit Bond) and most mortgage brokers. Also in some of the states conveyancers and real estate agents can issue Deposit Guarantees too.

The Deposit Guarantee can be issued for up to 10% of the deposit

For the potential seller the deposit guarantee represents security and assurance, as it is usually backed by a large institution and Deposit guarantee can only be issued if the buyer has either a loan approved or in a very good financial position to pay the full purchase price at settlement.

Easier to carry than cash, faster to obtain than bank loans or sale of property, designed for all types of property buyers.

Following links are for the reader's reference and further information if needed

* www.couttslegal.com.au/2015/10/12/deposit-bonds/
* www.eliteagent.com.au/2015/12/10/deposit-guaranteed/
* www.wisegeek.com/what-is-a-deposit-bond.htm
* www.commbank.com.au/content/dam/commbank/personal/home-loans/fact-sheets/Deposit_Guarantee.pdf
* www.westpac.com.au/personal-banking/home-loans/read-up-on/deposit-bond-to-pay-deposit/

Article Written by MADMENINX