Hello!
This is my first post here, so I hope to make it worth your time!
I am currently 20years old living in Japan, I move back to Australia in a few months. I will have a maybe $4000 saved from working here.
As soon as I get back to Australia (QLD), I will hopefully get employment at my previous place of work. I will then buy my first house (I am eligable for FHOG).
I have been looking into Vendor Financing, and am hoping this is "do-able" with a First Home. I have read quite a few books on Real Estate Investing, although I still feel I could learn so much more regarding VF.
Such questions I hold are;
Do I approach the seller myself, or would the fact that it would be my First Home and I am young put the seller off?
Would I have a lawyer attend with me? If so would this be an expensive visit should the seller decline my offer.
In the book I am currently reading, it states that you can ask the seller for less % interest then the current market, as they would be getting more money in the long term. Although I have read on many forums here that you should offer a higher percent?
Should I pay off and cut up my credit card (only 1) before beginning in any of this? Or reduce the credit limit to $1000? Would this make it easier and give me a better credit rating?
Do I have to take a copy of my credit rating when making an offer to the seller? Or would this come later when meeting and discussing specifics?
And mainly, How do I get the notion of VF accross without sounding like I have no money and am trying to "use" the seller.
Thankyou so much everyone for your time and thankyou in advance for replying!
I hope to own my first home by the end of this year (or nearly own it!)Kiara S
Hi Kiaira
Just to let you know that when buying under an Instalment Contract in Qld the FHOG is not payable on Settlement.
It is payable either:
1) 12 months from the date of possession or
2) Once 10% of the total contract price has been repaid i.e purchase price $250,000 requires total principal & interest payments of $25,000whichever is the later.
In saome cases depending on your repayments the Vendor may not receive the FHOG for upto 2 years.
Needless to say unless the Vendor has good cash flow he / she will need to wait for the cashflow.
Feel free to ask us any questions on VF in Qld you may have.
Richard Taylor | Australia's leading private lender
Hi Richard,
Thankyou for your quick reply!
I will keep that in mind thankyou! Should this be part of the contract? That the vendor would recieve my FHOG at the due time? Or could I recieve that and then put in toward further payments toward the vendor?
Any advice on my other questions?
Thankyou so much, I have read many of your posts and greatly appreciate the time you spend helping all of us!
Kiara S
Any Vendor offering VF will have incorporated in his Instalment Contract that he receives it.
Richard Taylor | Australia's leading private lender
Hi Richard and anyone else to help me!
Here is an offer i have just been presented with from a seller willing to give VF.
Purchase Price $320,000 (usual VF is at least 10% above asking price, this is only 3.6% above asking price)
Interest rate 8.24% (fixed for 3 years – could be good considering interest rates are on the rise again – this may even end up being better than a bank can offer you)
After 3 years the rate will be market variable interest rate +2%
Term 30 years –
Repayments $497 per week (interest only) or $553 per week (Principal & Interest)
Deposit is $10k (can accept First Home Owners Grant)What do you think?
Thankyou!
kiara
Normally sale price is more than 10% above asking price so this sounds good.
Interest rate isnt that bad.I have a few ones of my own which we have done at a fixed rate of 7.6% however these were taken out some time ago.
Other than the deposit which i guess is an issue in relation to the timing doesnt sound bad.
Course you know the address and the market value but as long as special conditions allow you to register a caveat could be good.
Richard Taylor | Australia's leading private lender
kiara
Normally sale price is more than 10% above asking price so this sounds good.
Interest rate isnt that bad.I have a few ones of my own which we have done at a fixed rate of 7.6% however these were taken out some time ago.
Other than the deposit which i guess is an issue in relation to the timing doesnt sound bad.
Course you know the address and the market value but as long as special conditions allow you to register a caveat could be good.
Richard Taylor | Australia's leading private lender
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