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  • Profile photo of bella84bella84
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    @bella84
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    March 15, 2014 - 9:41 pm

    Thanks Jac, just saw your comment! That's certainly the plan to involve him as much as possible : ) 

    Profile photo of bella84bella84
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    @bella84
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    March 15, 2014 - 12:14 pm

    Thanks for the comments above. Benny I like that approach, it gives a sense of tangibility to it for the 'giftees'.

    catalyst, interesting to note you've done this and it worked well.

    i think we'll just need to do a spreadsheet to track deposits and interest rate changes over time.

    Profile photo of bella84bella84
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    @bella84
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    February 26, 2013 - 10:47 pm
    Jamie M wrote:

    Exciting times! My wife and I are only three weeks behind you. 

    Best of luck with the offer.

    Cheers

    Jamie

    Sure is isn't it! Thanks and all the best to you both. 

    Profile photo of bella84bella84
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    @bella84
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    February 26, 2013 - 10:41 pm

    Thanks Jacqui, thought that might be the case. 

    Will keep the sink in mind too!

    Profile photo of bella84bella84
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    @bella84
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    February 26, 2013 - 9:13 am

    Thanks for your input Jamie, those are great suggestions too. I definitely need to do a bit of work to build my case. It's an IP and currently vacant so I'm guessing they'll want a quick settlement – i'll be proposing 60 days though as our first baby is due in 3 weeks so we'll be a bit preoccupied!  

    Profile photo of bella84bella84
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    February 26, 2013 - 9:04 am

    In that case you sure do know the area backwards! Isn't the colour scheme lovely?! I don't know what they were thinking surprise

    Thanks for those suggestions – a new shed of that size would be $5K (Colorbond) and the slab expensive, so I think it's pretty reasonable to bring up these points in the negotiation. Hadn't considered electrician costs, good point. Do you think I need to allow for the impact on capital growth or in this area do you think that would be negligible? (and probably difficult to put a figure on?)

    Profile photo of bella84bella84
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    February 26, 2013 - 8:54 am

    Thanks Shahin, that's good to know –  the way I see it, it can be more attractive as it's leverage for negotiation and limits the market somewhat (ie most developers).

    Profile photo of bella84bella84
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    May 22, 2011 - 11:03 am

    Wow thanks for the input everyone! And for putting me on the right track. Much appreciated.

    Profile photo of bella84bella84
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    May 20, 2011 - 1:52 pm

    Thanks for the additional reponse Richard, and for your advice Michael, it really is immensely helpful! I don’t know that i’ve fully grasped the best way to structure the loans, and speaking to my bank hasn’t made it any clearer (surprise, surprise!)

    Michael, you suggest releasing some equity in our PPOR to fund the purchase costs, etc. which sounds good. Our PPOR mortgage is with BankWest (Premium home loan) and as it’s still under the Lite Plus package (structured this way because we had a split loan with half fixed…I won’t tell you what rate was but *ouch*) loan setup fees and refinancing costs are nil. Sound attractive but i expressed that I was very keen to avoid cross collateralisation, but they then proceeded to advise me that the whole investment loan would need to be with them, not just the equity part to finance the purchase costs. Apparently they don’t finance property where another lend also has a hold over it.

    Did I get this all wrong and in fact should I position it as just accessing the equity and only using this amount as security against our current home? ie. setting up an interest only loan of $50K which we could leave sitting there until we’re ready to invest? Or would they veto this too?

    In this scenario, we’d then see a broker about getting an IO loan for the balance of the purchase costs, which is $200K. Am I on the right track?

    Thanks again for your insight.

    Profile photo of bella84bella84
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    May 13, 2011 - 2:42 am

    Hi Richard,

    Thanks for the welcome and the detailed reply! It's very helpful.

    I hadn't considered buying a property as anything other than joint proprietors – tenants in common makes a lot of sense if i'm in a lower tax bracket due to limited income/working part time.

    My initial thoughts are that we would use the equity in our PPOR for the deposit (to avoid mortgage insurance) and borrow the rest as an interest only loan (say $200K). I definitely want to minimise the exposure of our home.

    The best strategy for us at this point seems like buy and hold, looking for a house in regional VIC with a yield of 7+%. Within 1-2 hours of Melbourne is desirable so that it's easily accessed so we can do renovations to improve the capital growth and yield over time (and be able to claim depreciation on the improvements). Places that spring to mind are Ballarat, Mansfield or Heathcote/Bendigo area. Alternatively we could look at a unit closer to Melbourne, which may mean higher yield but less capital growth.

    Lots of food for thought, i need to do some more analysis and crunch numbers!

    If anyone else has any thoughts please don't hesitate to comment!

    Many thanks.

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