I've just read "0-260+ Properties in 7 years" and also "1,000,000 in property in one year".
They opened my eyes to poor financial decisions I've made and shown me that I don't have to work 5-6 days a week until I'm 65. Followed links in the books to this site.I have a question for successful investors out there.Our situation.
Mortgage: $215,000
CMV PPOR: $285,000 (CBA valuation)
Personal loan: $16,600
Dependents: 1Our desires.
To begin the process of investing in real estate with a goal of not having to work 6 days a week.Our options.
1: Sell PPOR, pay out mortgage/personal loan be left with approximately $30,000 cash after capital gains tax etc. Use this to buy IP and rent ourselves in a cheaper location.
2: Combine personal loan into mortgage on PPOR to reduce interest and focus on higher repayments off PPOR to increase equity.
3: Keep PPOR and borrow additional money to buy IP (limited by income plus not wanting to have to big an impact on our 8 month old by limiting available time with him).Our question.
I know what way I'm leaning but wondered, "Are there are other options I should look into before making a decision between the three options listed above".
Hi,
Won't claim to be a successful investor (yet) but here are some options I might consider if in your position:
1. refinance PPOR loan to 224k (maintaining 80% LVR and hence not subject to LMI) and pay down 9k into your personal loan. You would need to crunch some numbers to work out if this is worthwhile and also consider if additional repayments in your personal loan are subject to penalties.
2. refinance PPOR loan to 224k (maintaining 80% LVR and hence not subject to LMI) and use 9k for investment purpose, won't get you much in property space, perhaps shares but it would only stack up if your shares perform better than the interest savings opportunity in case 1
3. Refinance PPOR loan to 252k but you would be subect to LMI as LVR @ 90%, this would give you access to 37k equity which could be used a deposit for your next IP, pending your capacity to service an additional loan.
Regards,
TLPI would get rid off personal loan ASAP before thinking about investment
you can't have a return 10+% interest of personal loan in this climateHi Sparky's, why don't you keep the house but turn it into an IP, intead of selling it. There are a couple of advantages, firstly you can keep the CGT exemption for up to 6 years and you won't have to pay all the various costs associated with selling it and then buying the new IP. You are also obviously happy to live in it, so if things don't go well at least you know you can use it is a PPOR. I think if you analyse your situation properly, this will be by far the best course of action for you.
Regards
Alistair
You must be logged in to reply to this topic. If you don't have an account, you can register here.
