Hi everyone, couple of questions on my partners situation and the best method of structuring her 3rd IP.
PPOR $350000 owe 90000
IP1 $350000 owe 295000 rent 370pw
IP2 $200000 owe 150000 rent 240pwtotal equity is $355000
She earns 80k per year and has 30k cash and no other debt. The banks say her wage is not enough to cover more properties regardless of equity. She feels she can easily cover another loan.IP1 and the PPOR are with one bank and IP2 is a standalone with another bank, there is a 50k line of credit with the PPOR which helped purchase the IP2.
What do you guys think is the best way forward given the ammount of equity here? Theres so many stories of single income earners buying multiple properties we figure there must be a way to get around the perceived lack of serviceability.
She is also willing to sell her house to release the equity further so as to purchase more property, but is unsure wether this is benificial with rental accomodation at least $350pw.thanks!
Hi, has she gone to another bank?
Are the properties with the same bank cross-collateralized?
Are the loans interest only?
How long has she been at her current position and is it stable employment?Banks are much tougher now.. some friends of mine sent the bank their resume's after the bank questioned their application. It worked.
Hope she shops around. Perhaps a different bank for each property. maybe worth the hassle.She will go to different banks shortly, is currently with Suncorp on the main loan.
I gather cross collaterlization is when both homes are under one mortgage? I gather this is the case.
The loans are not interest only yet and she has very stable employment in the government.
A bit of additional information would be needed but based on the information to hand she seems to have sufficient income with a couple of lenders i can think of.
Dont think selling the PPOR is necessary although have the loans all crossed doesnt help when one lender says NO.
Sounds like she needs a bit of restucturing not only on the loan type but also the security held.
Richard Taylor | Australia's leading private lender
Sounds like you should see a broker.
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
She has actually been too a broker a few times but not recently, but came away none the wiser.
So to release as much equity as possible is it good practice to make most loans standalone? Or in this case is it more about structuring so that servicabilty isnt an issue. Once the market picks up again she will want to buy again so its an important time for her situation.
How can a broker help in this case and how do they get paid? The last one wasnt that interested except with his agenda.
Yes funny you say that I hear so many clients tell me their Broker seemed to have his own agenda and wasnt particularly interested in assisting them.
Mortgage Brokers are remunerated by the lender with whom they place you loan business with and their service comes at no cost to the client.
A Broker has access to 101 lenders and can therefore structure the loans in such a manner that allow access to your equity and combat issues such as serviceability by using different lenders where approproate.
Where possible i would always suggest having the loans standalone.
Richard Taylor | Australia's leading private lender
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