Wondering if anyone can help me here?
I am currently looking at a deal to be offered in early Jan 05 for my PPOR. The property is 4 yrs old and has tenants until May 05. I have had trouble getting the amount of finance i want because i have a personal loan eating my serviceability… I was wondering, because the house is rented for $150 p/week, if this would be counted towards the repayments? i.e, my parents were unable to buy their own property unless they were to rent, could i do the same and have the loan financed, and move in five months or so down the track??
Hi Destined…
You could use the rental income in the serviceability calculations to borrow more money but they will also look at the rent you currently pay. Unless you want to move back in with your parents rent free, the two would mostly likely cancel each other out. Remember, they will only use about 75% of the rental income in servicing to allow for vacancy and costs throughout the year.
Buying as an investment property would also mean you are not eligible for the First Home Owner Grant until you move in and then you would have to apply yourself.
If you can’t service the loan, it is a good indication that you should tread carefully. Have you considered getting rid of the personal loan as part of the deal to purchase your property?
Robert Bou-Hamdan
Mortgage AdviserM: 0414 347 771
E: [email protected]
W: http://www.mortgagepackaging.com.auFREE Finance-Related Newsletter: See – http://www.mortgagepackaging.com.au/index_files/newsletter.htm
Comments made are of a general nature and should not be construed as individual advice.
© 2004 Mortgage Packaging Pty Ltd
Hi Robert,
I am currently living with my parents rent free as you have suggested i should do. My girlfriend would be living with me when we eventually decide to move in… we don’t want to take a loan out in both of our names if we can help it.
My personal loan is rather large, as it was for my car. Is there any way of rolling them into one? I have approx $16,000 at $90/week owing. The property is going to be on the market for $138,000
You should sit down with a broker and do the numbers. There are various different options available. A lot will come down to how much deposit you have and your income.
As an example – and “I am not recommending you do this” as I do not know your personal situation – it would be cheaper to use your deposit to pay out a more expensive personal loan to reduce your liabilities and then, if you do not have any more deposit, take the more expensive 100% home loan to purchase the property and refinance it when you have built up some equity. This gets you into the market.
You really need to discuss all this information with a good mortgage adviser to see the best way to go for you.
Robert Bou-Hamdan
Mortgage AdviserM: 0414 347 771
E: [email protected]
W: http://www.mortgagepackaging.com.auFREE Finance-Related Newsletter: See – http://www.mortgagepackaging.com.au/index_files/newsletter.htm
Comments made are of a general nature and should not be construed as individual advice.
© 2004 Mortgage Packaging Pty Ltd
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