I had to go gaurantor for my wife, and my wife for me, that’s two solicitors in seperate deals.
PM me and I will give you the names of Solicitors I used – they both charged $50 for the 20 minutes or 30 minutes they spent with us.
It’s a safety thing for the banks because in one instance an unscrupulous person got their non-english speaking parents to go gaurantor and then went bust. The parents didn’t know what they were signing, and there was lawsuits and such.. the banks had some liability here to ensure that the gaurantor knows what they are doing.
The con’s are – less of the repayment is tax-deductable.
The pro’s of fixed interest are: Risk minimisation (hedging). – you might pay a premium for this.
It depends on your cashflow situation.
I would say if you are in an aggressive asset building phase – you might like to use interest only until you hit your plateau (wherever that is).
Then, as you sit & wait, you might like to fiddle some of the more CF+ deals to be P&I to gain equity quicker.
The interest only bit would have been useful for me during the High Cap Growth boom we just saw, but I chose P&I on intro rates because of the good rates. I am moving those to Int only, to aid my cashflow.
It really depends on your personal situation.
I have heard of some lenders offering up to 7 years IO but it’s more of a “friend of a friend” who told me..
I beleive Giving is sowing seeds. Seeds of money. Like investing.
I give to a sponsor child, our church, various missionaries, the Salvos, visiting speakers at our church, people that come to the door, people in the street, friends (coffees or whatever) etc.
One of the goals in wealth creation is to always have something in my pocket or hand so I can give it away!
In fact giving is one thing I find it hard to budget for. I do a budget and then blammo, someone needs money – so out goes the budget!
I am also learning about giving to my family and myself. This is hard for me to grasp – it’s about being generous in all aspects!
My thinking is that this is one of the major reasons I was created.
Sometimes I feel a bit like a hose – the money flows in, and right out again!
Ah well.
PS – I also give blood – so see you there emcdonald!
Well done for first home too – it gives you a VERY stable base to work from. Not for everyone but it solved some instability probs with my wife and me – sorted the itchy travel feet out for a while!
I started reading an e-book today- why not, I thought. It started off with “you were born to be rich…” That stuff just does not interest me. I have been watching the kids from Russia dying, further conflict in Iraq, 100000 people dying from genocide in Sudan, etc etc… an entitlement of being born rich just isn’t where my ideology is coming from. It makes no difference to me whether people have money or not. It’s just words.
kay henry
Hey Kay I read that ebook last week. I thought hmm.
My thought for my own situation is if I can become more wealthy, I can help more people. INCLUDING my own family.
If you are just getting wealthy for it’s own sake then what’s the point?
jump on the somersoft.com.au forum and search for ip_calculator. It’s a good spreadsheet – but there are potential mistakes in the tax department – but this might be due to ATO greed more than mistakes!
If your parents would not like to rent – perhaps you can sublet some of the rooms? This is often a good tactic and it gives you good insight into choosing people for tenants also! Will be a handy skill as you work towards your property empire.