Hi my name is William, and im from Sydney Australia. Im in my final year of year 12 and i have saved a total amount of 13k. Im interested in property and ive read a variety of books for example. 0-130 properties, Rich dad Smart dad, The Power of Property, and books my Margaret Lomas.
Ive read many forums over the last couple of weeks and ive seen how helpfull you all can be, i would no like some help myself:
My first question is would the bank be willing to lend me any money with the amount ive saved and if so how much ?
i would apperciate any feedback.
Hi William,
Names Sean from New Zealand,
I am much like you but a little bit older but still in the same boat.
My email is [email protected]
Would love to catch up with you on msn.
Cheers
Banks like to know that you can afford to pay the loan back. (they do not want to be on ACA )
They like to see employment history or
They like to see a business history for two years via a history of a registered ABN number.
you may need to investigate how the banks feel if you can get someone to guarantee the loan and loan repayments for your loan.Well done so far, keep saving, get a part-time job to maximise your deposit. Banks need to see that you can repay a loan ie have stable income before they will lend. At 17 and still at school, it will be difficult to get a loan.
wdemirdonder WOW
You are amazing…. how we could all only wish to have started thinking like you at 17 year of age. Who has inspired you or where did you get your inspiration from???
You could easily retire at 30 and be set for life if you keep thinking this way. Dont let anything get in your way and do not get side tracked..stay on this path.
Well done~
Hi: red123nz
Thanks for your comment im adding now as we speak, i would be more than happy to speak to you. I look forward to see u sign on !
Hi: Duckster & Scot no Mate.
I really apperciate what u have both said and the time that you have taken to try and help. Ive would be interested if you dont mind a short message on how you both started out. ( meaning if you have bought property how was it done ).HI: Francesco.
I really enjoyed reading your message it has really boosted my confidence, even though i read so much and have saved a good amount at so young im always still worried which i think is normal. Ever since a younge age i have been interested in property and my mum noticed this so she bought be severel books. At first i didnt read them because i was never interested in reading but just recently by chance i gave them a chance and ive been hooked now i read when ever i have a chance and constantly on the net one sites such as realestate.com and domain reading their newsletter, watching videos and looking at propertyI got started when I was 20 but only because my mother forced me to buy a property, that horrible women LOL
She gave me the deposit and drove me to the front of a house. I was working full time and could afford the repayments.
When I hit mid 20s.. I had built up so much equity, I used that to buy 3 more properties and then they went up and I once again pulled the equity to buy more and so on.
Dont be in a hurry….. remember, it is better to do one smart thing that you are educated in, that 20 stupid things.. if you keep up this studying and positive attitude by the time you get a job, you will get in there and be worlds ahead of all of us.
You didnt say if you were going on to uni or looking for a job? even tho I think job is a dirty word, without it, or another form of income, it is hard to get finance and you dont want finance anyway if you cant afford the repayments.
Very impressed with you!!!
Francesco.
Well im not sure about Uni, im not even sure what i want to do when i leave school to be ohnest. At the moment im working hard i have about 4 jobs, unfortuantly most of my money has been spend on driving lessons and my trip to bali over the new year. I have these for jobs thought for work experience because i love working im just not sure what i want to do.
I would really love to start my own business but i think thats more of a long term goal, ive had some thought in plumbing but then again i think i can do better. At one stage i was thinking of working out in WA in the mines were i could earn some good money, spend nothing and purchace some property for example in bali.
My biggest problem at the moment is deciding what i wanna do once i leave school. I want to buy property as soon as possible because at the moment i believe the market is doing well especially melbourne.
once again i would like to thank you for your positive feedback and time.
Hi wdemirdonder
The job you pick should be your passion. What are you passionate about????
My partner works in the W.A. mines, I think you may be a little too young…. you would need to work cooking or cleaning if you wanted get in now. ESS is a company that would place you in these sorts of roles.
It also depends what you want for the future, what do you really want? financial freedom? wealth? or just an easy life and a retirement plan?
I know beyond any doubt that I want financial freedom… I want to run my own life and own my time!
Francesca.
Your right about the mines didnt think about my age, i guess i dont have any qualifications. Im passionate about property i guess.
Financial freedom sounds good, Im not really interested in retiring young althought i dont want to be an employee and make my boss rich, id rather work for myself and put my ideas into good use. At school im studing Business and Economics among other subjects and i enjoy them.
This is my plan at moment but it always changes lol.
For example i leave school and take up an apprentiship in plubming, i live at home and my living expsences are low. Ive asked my mum and she has agreed to help me anyway she can, now ive done some work at a realestate agency and i found out i could use my mums property which we live in as insurance to the bank and they could lend me money.then my mum or bank would be like the lender im not sure which, and i would pay of the P& I with my personal earning, tenants and depreciation. could that work ? for my first property
Yes, I think you have thought out a plan.. you want to become a plumber, start earning full time income asap and reduce living expenses by living with your mum for a few more years… thats great.
The bank would still be the lender but your mother would become the guarantor, meaning, if you did not make the repayments, she would be liable for them and if she didnt pay them, they would take her house. You have a great mum :>
Just one thing, if you buy a property and rent it out straight away, you will not be entitled to the First Home Buyers Grant, I think its 15k… and reduced stamp duty. I didnt worry about that too much when I bought my first property. You would understand from economics the term "opportunity cost" which means that you stand to gain more by foregoing the FHBG than moving out from your mums house and having to pay all the bills on your own.
Even if your mum is still guarantor, I think you will still need proof of income for 3 months!
You know what you want to do :>
wdemirdonder – don't knock back a career as a tradie – they are in short supply. Sure the money for the first couple of years is a little lean but it does improve dramatically once you are qualified. Don't buy a car if you can avoid it – as a tradie/apprentice you may end up with one as a lurk of the job.
When I started investing banks required a hefty deposit, charged a higher rate for IPs and there was little in the way of govt support for investments/FHB. Even with a 50% deposit, stable employment, I still required a guarantor. That was when I was 21.
Get that deposit up & cut back on your trimmings – I still haven't been to Bali (but I enjoy 2 weeks in my favourite resort, of course).
Francesca.
Would i be able to put the property under my mums name as if she is buying the property, but i just look after it and of course pay her the initial deposit, so that i dont loose my FHBG and in a couple of years once im reading by my second property live in for a short period and ask my mum to put the first property in my name ?
I believe this would be a good idea if it could work somehow because my mum has a fantastic credit history, our house is fully paid off, and it most cases she would pay a lower rate of interest, because as the bank see's it she is a lower risk customer.
My exspenses are low at the moment, Ive only had to pay driving lessons and save extra money for Bali, although once i come back i will have to pay 150 a month insurance for a car, which will be a big problem. ( I Didnt buy a car im borrowing my mums, but shes on her P's to so insurance is alot higher than normal)
Scot no Mate.
Your right Scot, thats what everyone around me says. I might be a plumber cause ive done some work experience and i enjoyed it, and i havent bought a car, for the exact reason of saving money, plus with the people that i want to work with i would be issued a car. Its all sweet.
Its just $400 or so a week doesnt seem like alot, but i guess its better than nothing. What sort of property did u buy for your first and did u get First Home Owners Grand ?
William,
How I got started. Unlike you I did an apprenticeship and was good at saving. I saved up a deposit and when I meet my wife to be we decided to buy a house to live in. With her savings and mine plus our healthy employment record we purchased the house by walking into the real estate agents office. This is the hard part – getting past the real estate windows and actually talking with the real estate agent. We filled out the loan application with the real estate agent not the bank. Due to my wife's new career move we rented out this house and lived in a low rent house. This was 1995 and in 2001 I had a tax problem in that the house was making to much income so we decided to buy another house for $100,000 and while I was at University for the next three years I made the negative component of this investment from my savings and the rest from the rent. (this is an important point to note – once you have the loan it doesn't matter if you become unemployed as long as you can make the payments!)
When I finished university no one would employ me in a graduate position (A sore point) so I forecasted that my savings would run out in about 12 months so I put the second property on the market and sold it for $170,000.
I had to pay Austudy back as the $70,000 gain was deemed income and I had to pay capital gains tax.
I am currently looking at working as a bus driver as I have no intention of subjecting myself to the unrealistic tests and group tests of graduate recruitment programs of employers' out sourced recruitment agencies as they do not know what family friendly means and seem to be looking for the top 20% of graduates without caring what happens to the other 80% of graduates they keep passing over.Only recently since April have I gained part time work as I have two three year old children to look after and mum works full time. I know how hard it is to borrow money in your situation as I have been in a non employment situation from 2001 to 2007.
Just recently I have scaled down and borrowed $30,000 and purchased shares as this is where my talents really are in making income.
Somewhere in this time frame I also did a property seminar run by Freeman Fox and have gained a lot of my knowledge.So even though I only own one property I am sitting on about $150,000 equity, $50,000 in shares and $50,000 debt , so once I can work full time again I will scale up my investment level.
I forgot to mention also that our cars are paid in cash and are not brand new and also I do not own a LCD or Plasma TV and I do not borrow long term debt on my credit cards.
I would do the plumbing as it will be a great skill to have and will help with future property assesments and also will give u a good income which your banker will like. It will also help with improving property as the kitchen and bathroom are where the best improvements can be made to maximise rent.
My advice is dont rush into anything, get interest only loans with offsets so u can park yr money as u save for next property, have a big enough deposit to positive gear each property and dont sell !
Good Luck
Go wdemirdonder!!
In reply to your request for advice I also left school with not a clue as to what I wanted to do. So I found a full-time position in a cafe on fairly dismal money but it kept me busy and I had an income coming in. When I ended up buying my first property I made sure I could afford the payments even if I was unemployed (the original property was $95 000 with a rental of $140 wk. Before I bought it I also cut up my credit card, paid out personal loans and made sure the only thing I would owe to anyone was the mortgage. To summarise what Im trying to get across is:
1. Dont think you have to borrow a huge amount or have an annual income of $100,000 to get started. There is heaps of property out there to get started with they just tend to be in less than fashionable areas.
2. Dont get tangled up with credit cards/personal loans, consumer debt etc otherwise you'll just be a drone working to make the banks richer and not getting ahead. If I cant pay cash for something I dont buy it.
3. It is absolutely possible.
I am about to buy another couple of properties in 2008 due to the equity having built up in my first. They will both be under $150,000 with an anticipated rental of $170-$250wk. And I still only earn about $40,000 a year.
Best of luck!!!
Hi, I have read quite a few book over the past year or two on investing/self help/inner power ect.
I have also been following the forums for over 6 months but have not made many posts as of yet, Im 20 years old and I have been working in the trade as a Plasterer for over four years now and currently earning 50k+Personally I think the trade is a good area to work in for a few reasons.
1: Demands for tradies are high so there is little unemployment and high wages
2: Because your not working in a shop/office hours are usually more flexible and there is generally more freedom (Many tradies don't work past 2-3pm and weekends are optional)
3: Your actually producing something and get to see the finished product.
4: Once you have learnt enough you can go out on your own Contracting where you have the potential to earn 150k+ a year, or you can choose (like a few people I know) to work only a few days a week and still pull in 50k.If any other young guys want to contact me they can talk to me through msn: [email protected]
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