Forum Replies Created
The Location and post code are acceptable to most lenders and mortgage insurers
Regards
CraigXinc is a mortgage group similar to Aussie Home Loans and actually branched away from them
the product is a professional pack loan with annual fee which provides a discount based on the loan size +$300k I understand the product the discount relates to is their own branded and mortgage managed product
This product will have exit penalties like RAMS so I would check out the cost to leave vs the saving on rate
CraigIt does seem a little unusual to see Richard suggest one of these loans however they do have their place and provide no more risk than any traditional loan. What they do provide is a simple structure which is pre set by the lender rather than leaving equity management to the investor. For this reason I consider they fit new a investor profile especially with a suggestion of cash flow shortage.
From a risk perspective these loans operate on lower LVR lending and I would suggest as a result are less likely to arrive at negative equity than a standard 95% plus LMI loan
Craig
Another factor to consider is splitting the loan accounts into 3 separate accounts.
Whilst this can be done with most lenders Colonial (CBA) have a specific structure which requires for each owner to individually service their own loan account. (Richard doesn't like this lender)
Each owner of the property must guarantee the others loan however the bank does all the structural work setting up the the loans.
All loan types and packages are still available.Hi Daedalus
For commercial property there should not be any rate difference if using a company or trust. AS with domestic mortgages there does not have to be extra charges it is lender dependent.
If you have sufficient equity you can utilise a basic mortgage however if using commercial property as security then the loan structure is specialised.
Lending amounts are limited depending on the building style up to a maximum of 85% LVR
The costs can be higher depending on the building value especially with valuations and don't forget that GST is applied over the purchase amountRegards
Craig
Hi Kirsteh
Banks will generally take the lower of purchase price or valuation on the basis that the purchase price represents the current market value. The LMI is a small price for the gain you seem to have made.
Some lenders will take the valuation amount (which at this point is not known ) and unless a valuation came in significantly higher then you would still have mortgage insurance and deposit to pay.To gain equity from your PPR you will need to increase the loan amount so you can withdraw a cash amount.
Regards
CraigHi Anzion
I think it may be worth the wait to let the fixed rate run its course however as the cost of an extra 0.25% I think would be more over 12 months than the cost to loose your lower rate for 4 months.Fix the LOC or set up another sub account if the funds are utilised. A line of credit fully drawn is just an interest only loan anyway.
For my opinion on rates is that I consider they are at the high end of the rate cycle and due to go down and would be wary of fixing beyond 3 years however like all the experts in this field there is a 50% chance of being right.
If all else fails toss a coin.
regard s
Craig
Hi George
Happy to help also
You have made the first step in looking and checking there are a large number of people who simply set and forget often providing a boost to the lenders profit margin
RegardsCraig
Hi
Certainly a separate loan account or split for the new amount will have its own calculations for interest and the purpose it is to be used for will determine the tax application to this account.Regarding your offset amount you may wish to consider lowering the home loan amount by $50,000 and making the investment split for $84,000
With the refinance you will most likely be liable to pay a lenders mortgage insurance and unless you have previously had the loan amount at 90% then this fee will be applied to the total loan amount including the existing amount.
Regards
Craig
Hi Juder
Loans can be taken to 100%+ so that fees and charges can be included. You may find that there is a difference in the the way lenders calculate positive cash flow as a means to service a loan so some supporting income may also be required.
The other thing to consider is that 100% lenders are usually only interested in high population areas 10,000 people or more
Otherwise easy as pieRegards
CraigHi Anita
this is a very good question and has quite a few answers
It is my experience that many people cast options amongst brokers looking for diverse options which will commonly provide a diversity of feedback based on broker knowledge and presumed product criteria. This is usually without the benifit of intimate client financial knowledge.At the point of sharing your financial and personal details then I would suggest that consideration be given to the professionalism and opinions of the broker. There is a relationship established where legal and moral obligations should be applicable
This is where your delema may have occured and I would suggest you had a broker who had the moral and legal ethics rather than one who is product inept.
This issues of fraud and deception are high on the radar in a low document situation where the applicant is unable to prove enough income to satisfy bank requirements. Where a broker becomes aware of an income declaration being false then the broker becomes a participant in the fraud risking their profession and income as demonstrated in the "homeless person" loan in ACT
Business is business where your relationship is with a broker i believe it should be built on a professional value situaiton to best suit your investing business. As the finance broker model is not built on a fee for time like an accountant or solicitor a broker must provide advice and services in the same manner as other professionals however are only financially rewarded after a loan has been successfully funded. For this reason it is easy to have them compete for your services.
From a moral perspective does multi quoting apply to all the professions – Doctors, accountants, solicitors and brokers or do brokers stand out because there is no financial disincentive.
My opinion – Find a broker who fits your needs and develope a trusting relationship. Use cross quoting if you lack the trust and then discuss the results of your research to detirmine your choice to stay or move on.
Craig
As a general rule up to 70% is considered standard however unless the property is considered specialized then up to 85% can be achieved.
You must also consider that establishment and valuation costs tend to be much higher than residential.In this case your $85k is almost enough for the deposit at an 85% lend however I would expect that you will need to find @ $12k for costs.
You will also need to check if GST is included in your purchase price often it is not so you will need to add a further 10% to the purchase cost.
Commercial loan are often slower to complete so it is not something to place unrealistic expectations on achieving short settlements.
Regards
CraigBit late on the scene but if you are still looking you may like to call Phillip Aggs and Co
Level 17 127 Creek Street Brisbane Phone 07 32210963
referred by CraigIf you look at the product disclaimer on the web site it will show you the company is part of the Sample and Partners Group which focus on mortgage reduction and budgeting programs usually charging a fee for this service.
Hi Jayro
In a lot of cases it pays to break the big picture down into sections. for example
Your current structure – what is the maximum you can achieve without introducing anything new.
Naturally leaving this with your current lender will then save potential new loan expenses especially lender mortgage insurance.Knowing what you have in terms of deposit there is then only the income capacity to explore. In this case there are some lenders who allow a higher portion of rental income for servicing loans.
IN addition to this by using separate lenders your current loan committments are measured on their cost and not at a higher qualifiying rate used by many lenders when assessing new loans.A new lenders exposure to risk is only focused on the new property
Regards
Craig
There are a couple of lenders who will provide a higher servicing level using fixed rates which could be a good solution – You would loose the flexibility of a Line of Credit but secure against the current interest rate climate and increase your borrowings.
Wow wasn't that fun
but where are the accountants with opions on this too.So true Alistair except this is non regular typeof loan which offers DSR up to 67%, does not use a mortgage insurer and the capitalised interest is tax deductable, unlike the interest capatalised in a loc or offset account.
CraigSorry that seems silly the whole concept of the low doc is to take away the need for a lender to intepret figures by simply making an income statement . Naturally from an affordability factor you will need to be able to afford this as the onus is taken away from the lender, which is why you are generaly signing a statement which specifically requires you (or your company) to declare you can afford the loan. Happy to help
Craig
It appears there is plenty of equity for an equity only loan.
I would suggest a staged finance approach to your plan spreading the lending. You may find if you are using one lender such as St George you will be capped not only by income, and security but also with to total loan amount expecially under low doc
Does your company have gst registered.
Craig
