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What do the 2024 tax cuts mean for you?

Oktay Sengoz

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21/06/2024

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1.5 min read

The Government tax cuts will take effect on July 1, 2024, increasing take-home pay for most taxpayers. These adjustments to tax rates will, in many cases, reduce tax bills by thousands of dollars.

This change comes as a relief to many Australians facing rising living costs and high-interest rates. The tax cuts could save you up to thousands of dollars. But how do these savings impact your ability to get a home loan?

How these tax cuts benefit you when applying for a home loan

Buy your home sooner

The additional savings can significantly boost your house deposit, enabling you to purchase your first home earlier than planned. When combined with government grants, you might find yourself ready to buy a home sooner than you thought possible.

Already have a home? Boost your offset account and save

By depositing your tax savings into your offset account, you can reduce the interest charged on your mortgage. This strategy not only lowers your interest costs but also provides you with accessible funds when needed.

Pay off personal debts

Use your tax savings to pay off or reduce personal debt, such as personal loans, Buy Now Pay Later (BNPL) accounts, car loans, or credit cards. Reducing these debts can improve your overall financial health and creditworthiness.

Lenders will adjust their servicing calculations to account for the additional tax cuts when assessing your home loan application. This means you may now be able to borrow up to $100,000 more, making a significant difference in your ability to purchase a property. These strategies can enhance your home loan application by increasing your borrowing capacity or boosting your savings for a larger property purchase.

Contact us today to see how we can help you make the most of the tax cuts to buy your home sooner.

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