Hi all,
Can one of you experienced wrappers inform a novice (me) what sort of finance should i looking at to purchase a property and then wrap? P&I or interest only or does it matter as my margin will always give me +ve cashflow?? At the end of the day I am looking for a win win outcome for me and the wrappee. Any advice would be greatly appreciated
Happy investing
Damien
Hi Damien,
That’s a pretty easy question, if you have a P&I you might make $400 per month, if you have I/O you might make $500 per month.
You might want to start on I/O to maximise cashflow, say 5 years, and then switch over to solidy your long term position.Hope this helps…G7
I think in some states, (VIC) you are required to use PI loans on installment contracts.
Terryw
Discover Home Loans
North Sydney
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
TerryW
Depends which lawyer you consult!
There’s a couple of interpretations of the act.
Certainly I think that it’s always imperative to keep your loan lower than the wrap loan, and preferably with a serious buffer inbetween.
My lawyer’s view is that IO loans are not specifically banned (they didn’t exist when the law was drawn up) so therefore you can use them, but his personal recommendation is that it should only be for a short period of time.Keep smiling
Felicity
Hi Felicity
Thats good because I actually did two in Vic with IO loans! Been cashed out now though.
Terryw
Discover Home Loans
North Sydney
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
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