Chaning Lending Standards
Lending standards have been increasingly tightened over the past decade. Concurrently the pace of tougher regulations around home loan approvals has been increasing over the past two to three years. Even though the Royal Commission into banking has yet to release its findings, lenders have already taken action that is making it harder to get approved. More so, lenders are simply lending less money (around 10% less) whilst requesting much more detail on an applicant’s monthly living expenses.
The type of loan most affected by the new era of regulation is around interest-only loans. Lenders are now far more reluctant to approve or extend interest-only loans for borrowers, which will leave some borrowers in a tight spot when their interest-only term expires. A handful of borrowers will be forced to sell their investment properties if this is the case, however they should consult a mortgage broker before they do so.
Regulation is all in the name of trying to avoid a US style sub-prime property market crash. What is overlooked is that prior to the sub-prime crisis in the US the number of American mortgagors who were in default was 13% however it’s rarely higher than 1% in Australia.
As part of Stanford Browns employee education program we can deliver an onsite presentation to your staff on this topic. Contact me for further information.
Insurers Make The Bankers Blush
The Financial Services Royal Commission has set its sights on the insurance industry over the last fortnight, with some of the misconduct enough to make a banker blush! The proceedings started with Clearview admitting that it may have broken the law more than 300,000 times by using cold calling tactics to sell insurance, whilst perverse compensation arrangements at Freedom Insurance resulted in a man with down syndrome buying several insurance policies after receiving an unsolicited call.
The cases heard in the Royal Commission underscore the importance of having a trusted adviser when purchasing insurance and making claims. Policyholders with advisers have much higher success when making claims, and if troubles arise, our clients can rest assured that the resources and networks of Stanford Brown will be leveraged to ensure they receive the best outcome.
The Commission’s interim findings can be found here.
Did you know that according to a study conducted in the UK, men were found to know more about breast cancer than they do prostate cancer? The Movember Foundation each year raises awareness to tackle men’s health issues in Australia including prostate and testicular cancer, mental health and suicide prevention. You can get involved by donating, completing a workplace challenge or growing a mo. Start the conversation to probe the investigation!
Global Trends on Employee Benefits
MAXIS GBN, a global benefits network, has produced an interesting paper on the changing global employee benefits sector and where they see global trends are heading.
The most common trend is developing individualised, tailor made wellness benefits for employees as opposed to a one-size-fits-all strategies.
One interesting table demonstrates the 6 highest ranked initiatives employers plan to implement in the next 2 years:
Stanford Brown specialises in designing engaging Financial Health & Wellness Programs for companies that care about the financial, physical and mental wellbeing of their people. To learn more please reach out to James McFarland at [email protected]
Employers Forced to Consider Flexible Work Arrangements
Employers will be forced to justify their decision to knock back requests for flexible working arrangements under a new clause inserted into all modern awards by the Fair Work Commission. According to the Commission, the decision was made following a “significant unmet employee need for flexible working arrangements” in Australia. Under the new clause, employers will need to properly consider the request and give a detailed explanation in the event of a refusal. To learn more, we recommend you read the following article.
Health Insurance Reforms Clear Parliament
The coalition’s private health insurance reform package has passed parliament. Changes include health insurers having the capacity to pass down a discount to people under 30, categorizing covers in a four tier system (Gold, Silver, Bronze and Basic), offering greater excess in exchange for lower premiums and being able to upgrade cover to access mental health services without a waiting period. To read more about the reforms, visit here.
The #1 Office Perk?
A survey by HR advisory firm Future Workplace reveals that employees crave an office perk far more fundamental and essential to human needs – natural light. The survey found that over a third of employees feel that they don’t get enough natural light in their workspace. Furthermore, research by Cornell University reinforces the connection of natural light to employee wellbeing. In fact, research revealed that workers in daylight office environments reported a 63% drop in headaches and 56% reduction in drowsiness.
Suit Shorts Acceptable?
Summer is approaching and the office air-con is on the blink. Your train to work is the temperature of an Ibizan beach and your colleagues seem unsympathetic to your sweaty plight underarms. It begs the question – should you wear shorts to work? Get the opinion of the professionals here.
Video of The Month
Owner: Just keep the office windows clean.
Builder: How bout a waterfall?
We hope you’ve enjoyed this edition of Eudaimonia and we’d love to hear your feedback.