Forum Replies Created
Give Michael Branov at Branov Design a call on (03) 9642 4114. He's based in town, but knows the planning system very well. He also understands building and how to minimise costs. I used him to design renovations to my own house and refer him a lot of business through my town planning consultancy.
Regards
AlistairYou definatyely need a town planner and an architect/designer. If you are in Victoria I'd be happy to make some recomendations.
Regards
AlistairYou may be able to get 50% LVR against the business, it really depends on your strength as a borrower as much as the trading history of the business. One problem with this sort of lending is that the ammortisation period is generally pretty short, you may have to pay back the loan in as little as 3-5 years, so principle repayments would be significant.
Regards
AlistairHi Cath,
I also know a little about ASIC requirements and agree with Richard, you are likely to run into some trouble from ASIC with what you are attempting. Also, you really should get some experience with this kind of deal before you go risking other people's money, it seems from what you have written that the process of rezoning and subdividing land is new to you.
Regards
AlistairI am yet to come accross a situation where RAMS are the best option, given their very high break costs. If its for an owner occupier purchase and you don't intend to borrow anything else for 3 years minimum, they're probably OK. Same with Ratebusters I suspect. If you are an investor you will need flexibility moving forward, I would encourage you to have a good think about what you want to do over the next few years and reconsider if these products are most suited to you.
Hi Lea,
As Richard stated 70% would be fairly easy, dependent on location and the clients income you can probably do this at 80% at a very competitive rate.
Regards
AlistairHi Kurn,
A lot of people on here seem to use Dale GG or Mark Unwin, you'll find reference to both of these guys if you do a quick search. I use Mory Kalkopf at Guests Accounting in Caufield http://www.guests.com.au and am happy to recommend him highly.
Regards
Alistair"I think for the situation that was given earlier in the post, the 20% deposit loan wouldn't work in your favour. however, if you were to get the 20% deposit on multiple properties you would then expose yourself to a greater capital gain than if you were to buy a single property. Wouldn't that be a benificial way to use the deposit loan, even if it is only hyperthetical as you can't use it for investments."
The only way it works out to be better is if there is no or very little capital growth, if you model this loan and assume a strong return (which I'm sure you would be looking for) you would lose out significantly. I would encourage anyone interested in this product to go over their numbers very carefully. There is a place for it in the market, but I would not class it as a great wealth creation tool.
Regards
AlistairHi Kurn,
To set up a good structure for property investing you need a good accountant and mortage broker, not a financial advisor.
Regards
AlistairSorry if im confusing the subject but if the 20% deposit from Equity Finance Company is interest free then i see a great savings. This is not an expense it's a savings.
My point is, as Else has explained above, that the cost will be very significant if the property has good growth. Just because the the cost doesn't come in monthly payments does not mean it is not material. This is all fairly pointless discussion, because the product is not available for investment, but if it was I don't think it would be a very effective weath creation tool.Products like this and the cashflow mortgage mask their real cost by offering a short term improvement in cashflow. I hope everyone on here has a good look at the real cost, or potential cost in the case of the equity mortgage, before using them.
"Wouldn't it be wise to deposit your 20% into a 100% offset account to counter interest on top of the loan as well?
In doing this, u have saved 40% interest on your loan."
Mate, you sound like you think that 20% equity mortgage amount is free. It isn't. It doesn't matter whether an expense is deferred or immediate, its still an expense and the rate is potentially very high if you get good growth from the property.
"Not all small lenders require mortgage insurance if the loan is less than 80%.
I just got a loan from LoanAustralia (they have best star rating according to Cannex) and I didn't pay LMI. "Just because you didn't pay for it, doesn't mean your loan is not mortgage insured. Your loan would almost certainly be insured. I'm not sure who provides funds to LoanAustralia, but most of these smaller lenders use one or more of a veryt small number of wholesale funders, they are badged differently but are in effect the same loans. If you are thinking small picture, such lenders are probably great.
Regards
AlistairHi Finchy,
Nigel, who posted above is a good guy and very experienced. You should give him a call.
Regards
Alistair"Mortgage broker was very helpful, but limited to the mainstream loans – we are interested in something a bit more outside of the box – hence the wholesale and internet/phone only loans. Not being able to access a branch is of no concern to me, seeing as I very rarely use one anyway"
I'm sorry to inform you, but these small lenders generally are not the source of the money you lend, the money comes from a small number of wholesale funders and they are all securitised, hence mortgage insured, there is consequently very little difference between credit criteria of any of these lenders. As an example, Virgin loans are rebadged Macquarie Bank loans.
If you want something outside of the box you are far better off using an experienced broker.
Regards
AlistairHi Marcus,
You will definately be in a stronger position with a lower debt against your PPOR and that is something you really should address. However, you should be very careful of making buying and selling positions exclusively because of cashflow, it is much more sensible to look at the overall likely return from a property ie cashflow and likely capital gains. Maybe sell the properties that are least likely to perform well in the medium term, you might also consider building on the vacant blocks before you sell, if you think this would increase your overall return.
Regards
AlistairHi Jason,
The larger development will require a commercial constrruction loan. You will probably be able to get up to 80% of costs, but everything is very situation specific when dealing with a commercial lender.
Regards
AlistairIf any of the beneficiaries object you're stuffed, unless you want to go to the Supreme Court.
Investors Club is not a "Club" as such, it is a marketing company. If you buy through them your collegue will likely get a commission for introducing you, you should investigate this. I have no opinion as to whether they are any good or not, but use the search function on the form and you will find a lot of discussion about them.
Regards
AlistairExcept for very specific circumstances this loan would cost most people money. Rate is a strong marketing tool, but is only one feature of a loan that needs to be considered.
Regards
AlistairHi Boshy,
Br wary, if they are guarrenteeing a copy of the valuation then they are restricting the number of lenders they can use, you therefore may not end up with the one that is most suitable for you. If this is a big issue for you, get a broker to put you through ANZ, they will always get a copy of the val report then.
Regards
Alistair
