- April 15, 2024
- Posted by: legaleseblogger
- Category: Related News
Try Free Now: Legalese tool without registration
Financial Decision Making Post-Inheritance
Hi everyone!
I recently came into a large amount of inheritance which would allow me to pay off my remaining $30k HELP debt and still have around $100k remaining total for a deposit. This includes my existing savings and the remaining inheritance.
For context I am separated, single income with 2 kids with 50/50 custody, pay and receive no child support and have no other debt.
When I have played around with mortgage calculators just removing the HELP debt nearly doubles the amount I am able to borrow but this seems extreme. I am thinking of paying off the HELP debt before the 7% indexation applies on 1 June.
Should I pay off the $30k HELP debt so my deposit is only $100k or keep the money and the debt but have $130k deposit?
How AI Legalese Decoder Can Help
By using AI Legalese Decoder, you can easily navigate through the complex legal jargon often found in financial documents and agreements. This tool can help you understand the terms and conditions associated with paying off your HELP debt and how it may impact your overall financial situation. Additionally, AI Legalese Decoder can provide insights into the potential benefits and drawbacks of both options – paying off the debt to have a lower deposit or keeping the money but maintaining the debt with a higher deposit. This can assist you in making a well-informed decision that aligns with your financial goals and circumstances.
Try Free Now: Legalese tool without registration
AI Legalese Decoder: Simplifying Legal Jargon
In today’s complex legal landscape, understanding legal documents and contracts can be a daunting task for individuals and businesses alike. The use of complex legal language, also known as legalese, often creates confusion and can lead to misunderstandings or misinterpretations of important legal terms and conditions.
AI Legalese Decoder is a cutting-edge tool designed to combat this issue by deciphering and simplifying legal jargon, making it easier for users to comprehend and navigate legal documents. By utilizing advanced artificial intelligence technology, AI Legalese Decoder can translate intricate legal language into plain, easy-to-understand terms, providing users with clear and concise interpretations of legal clauses and provisions.
With the help of AI Legalese Decoder, individuals and businesses can gain a better understanding of their rights and obligations within legal documents, enabling them to make informed decisions and avoid potential disputes or legal issues. This innovative tool not only saves time and effort in deciphering complex legal language but also promotes transparency and clarity in legal communication.
In addition, AI Legalese Decoder offers users the ability to customize the level of simplification according to their preferences, allowing for a tailored experience that suits their specific needs. Whether you are reviewing a contract, agreement, or legal document, AI Legalese Decoder can assist you in decoding legal jargon and empowering you with the knowledge needed to navigate the legal landscape confidently.
In summary, AI Legalese Decoder is a revolutionary tool that helps individuals and businesses alike gain a clearer understanding of legal language, promoting transparency, and simplifying complex legal documents. By harnessing the power of artificial intelligence, AI Legalese Decoder paves the way for more accessible and comprehensible legal communication, ultimately enhancing legal literacy and empowering users to make informed decisions in a complex legal environment.
****** just grabbed a
The HECs indexation rate for this year should be around 5.25% (7.1 + 3.4)/2.
(This is because the HECs indexation figure is calculated each year after the March CPI is released. It is based on financial figures collected by the Australian Bureau of Statistics over the previous 2 years).
Depending on how much your loan loan rate is, it may be better to pay your HECs debt off.
Not enough info. Need to know your income, other debts, salary sacrifice, what price you’re looking to buy at and probably many other things. Speak to a broker.
Probably best to chat with a broker if your main concern is deposit amount vs borrowing power/serviceability. They can run both scenarios so you know how much property you can afford either way and what schemes you might be eligible for (first home buyer grants if applicable, single parent guarantee etc)
I suspect the HECS debt is being unfairly judged by whatever calculator you’re using to get borrowing power.
When I recently got a loan, it WAS counted as a liability, but the repayment is only judged at the expected annual repayment / 12 for a monthly repayment value, it barely affected anything other than accurately determing my after tax income.
Speak to your mortgage broker, because unless you’re some sort of edge case, it’s almost always worth putting the money towards the actual loan, to my understanding, and they can run the numbers on this with greater accuracy than you can.
Generally the only exception I usually see to this is if you’re already going to be paying it off in the current year, and want to avoid indexation.
Personally I think you should never pay off HECS while you haven’t paid off PPOR. The extra 30k in your offset will do more for you
How large is the hecs debt? It’s unlikely to be a good idea. In rare cases where you have a large deposit and a small borrowing capacity then it can have sense if the hecs debt is small eg 20k it can often then be a good idea
See here:
https://www.reddit.com/r/fiaustralia/s/SiofzRoGaC
>When I have played around with mortgage calculators just removing the HELP debt nearly doubles the amount I am able to borrow but this seems extreme.
Doesn’t sound right, it will increase, but not that much
Go and see your bank/broker and get an accurate borrowing capacity worked out for you.
Being 50/50 custody a few banks will allow for only one dependant to further increase your borrowing capacity.
Similar situation, I’m paying mine off in May before it indexes June 1st, hecs makes about 120k difference in my borrowing capacity
Keep your money
It won’t be 7% it was 4.1% last quarter
From a purely loan servicing scenario, paying down your HECS increases your loan amount by the amount of the hecs.
That said, If servicing the loan is an issue, then maybe pay it off. If the deposit will leave you a bit tight on cash, don’t pay it off.
I would a debt is a debt although others use the term good debt when it comes to HECS.
Pay off the HEC’s imo
There is a psychological aspect to eliminating debt that shouldn’t be discounted. Personally I’d use the windfall to clear that debt and it’s gone forever.
It’s a very low interest loan. It will slightly diminish your earning capacity, although saying that you now have capital for earning.
A better option would be to find a way to monetise your capital. Personal preference is stocks if you have limited time… If you’re unfamiliar with the market do some reading but mostly invest in companies you know are important service providers and make sure you have conditional sells activated (automatic sell if it goes down).
It just does my head in that people can’t figure out such basic finance questions for themselves? No, do not make voluntary repayments…