I have a cashflow -ve property in Vic with a P&I loan and looking to refinance for an IO loan to help bring it closer to a neutral to +ve situation. I’m currently getting the house evaluated at the moment but I gestimate it to be around the 180k mark. I have about 140k on the loan and a tenant thats about a month into a 12 month lease at 170 a week.
Any thoughts out there as to what to do or who to speak to in order bring the repayments and rent returns closer if not in the black!
I’m also finishing full time employment in June and as yet have no guaranteed work to walk into.
Any input would be greatly appreciated.Globe
Globe,
I just refinanced 1 property with Homepath. They take ages, so I don’t think they could ever be used for a purchase, but for refinance they are pretty amazing: 6.15%, no fees, IO.
You have to apply through their website, then it’s all by mail and phone. Really a bit of a painful process compared to dealing with a friendly broker, but rock-bottom prices!
Mick
Globe,
Talk to a couple of brokers to understand alternative financing options. Interest only seems like the obvious options.
(Much discussion regarding Interest Free loans elsewhere in this forum…)Given you have entered into a 12 month lease, there is nothing you can do from that perspective, until the lease expires. Of course any minor reno’s in another 12 months will depend on what value in rent and value you could attain v. cost
When doing your tax return (well before actually)it may be worthwhile examining a tax depreciation schedule from a QS for the purposes of claiming depreciation, if you have not already done so. Not sure how old your property is.
James
Thanks for the info Mick and James.
I’m going to check out the Homepath website and speak to some brokers for more info on what to do too.
I’ve looked at the depreciation side of things and because of the age of the property (40 yrs) not much can be done.Cheers
Globe.Globe, I think you missed the bit about INTEREST FREE Home Loans. Refinancing is fairly easy to do with them. Forget HomePath unless you actually want to pay some interest.
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The forumite formally known as Big RobOriginally posted by globe:I’m also finishing full time employment in June and as yet have no guaranteed work to walk into.
Hi Globe,
At this stage I wonder if this issue isn’t more important.
Given that there may be a period of time when you are without an income is the current loan in ‘credit’ and/or do you have the capacity to ‘stop payments’ between jobs. Switching to an interest only loan may create some issues here.
The need to reduce your outgoings also needs to be balanced with the possible loss of income.
As I am not a broker and do not know the ‘ins and outs’ of the state of play with respect to these issues maybe this is something a broker could provide some thoughts on.
Derek
[email protected]Property Investment Support Available.
I am ahead in payments as I do pay extra into the loan each fortnight.
I’ve since found out that I can get employment in June but at a much reduced pay as what I receive now (on 60k gross now, going to about 25k gross)
So your option you’ve pointed out of stopping payments may also be a factor to consider… To be honest I didn’t even think of that!?! Crazy huh? It looks like I need to seek some professional help to put everything in perspective for me.
Thanks for pointing out the bigger picture for me Derek.Globe.
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