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  • Profile photo of Cameron_2Cameron_2
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    @cameron_2
    Join Date: 2003
    Post Count: 6
    August 30, 2003 - 9:02 am

    Hi doogs,

    If you borrow new money, you pay mortgage stamp duty on it. The lil’ buggers in state gov. know how to rob us of a dime at any opportunity eh.
    Aparantly you even pay mortgage stamp duty again if you take your existing loan to a new security property – known as portability. How’s that for cheeky!! But MSD is not usually more than LMI. Talk to a broker for the first purchase, and they should be able to give you more specifics relevant to your particular situation for the next loan.
    Cameron

    Profile photo of Cameron_2Cameron_2
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    @cameron_2
    Join Date: 2003
    Post Count: 6
    August 30, 2003 - 8:50 am

    Hi aaronj,
    I’m not quite sure what your question is. But if you are asking whether a lender will accept centrelink payments in the same manner as wages when deciding if you can afford a loan, it does depend.

    For example if you want to use family payments as part of your income, your children must be under 12 years old. (i.e. the income must continue for at least 5 years.)
    Lenders generally won’t accept unemployment benefits. As for youth allowance, I’m not sure but probably not as there is no guarantee on it continuing.
    Hope this helps.
    Cameron

    Profile photo of Cameron_2Cameron_2
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    @cameron_2
    Join Date: 2003
    Post Count: 6
    August 29, 2003 - 12:06 pm

    Thanks everyone!
    You have given me a lot of confidence. His solicitor faxed me the contract today and I’m reviewing now ready to sign.

    Given that most plumbers I’ve talked to say $5-6K max, it’s a bargain. [:D] Think I’ll hold onto it as Burleigh is a place where many developments are planned and it’s a seachange venue for the babyboomers – just has to go up in value, you’d think!!! Although it has boomed after the last couple of years – should still remain strong for a few years yet…

    Now here’s a thought – what about what happens after the baby boomers have all bought their investments, are retired, keel over, then leave the rest of the population with too many properties?? Like say in 15-20 years? Will historically high capital growth investment property still be such a good investment? I haven’t read his book yet, but is this one reason why Steve suggests properties in non-major metro areas with 10%+ returns – obviously these properties are not reliant on capital growth for investment returns!

    It’s starting to make sense to split property investments into potentially high growth areas (-ve gearing) and also low growth areas (+ve gearing) – that way you’re diversifying your risk. What are everyone else’s thoughts??

    Profile photo of Cameron_2Cameron_2
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    @cameron_2
    Join Date: 2003
    Post Count: 6
    August 28, 2003 - 11:03 am

    Hi guys,

    As understand it cross-collateralisation usually is required when you have equity in one property -say your place of residence, and you want to purchase another property with finance for 100% of the purchase price plus costs, on a new, seperate loan – say an interest only loan. This keeps your tax deductable debt seperate from your non-taxdeductable debt. Both loans are secured by both properties so that the combined LVR remains below 90% (in most cases) or below 80% to avoid LMI costs.

    So if you want to restructure (say your investment loan) so that it is only secured by the the investment property, then your investment loan must be 80% of the value of the investment property (to avoid mortgage insurance).

    A loan restructure such would probably incur two sets of valuation fees – $200 to $300 each. It’s not new money so wouldn’t incure any loan stamp duty.

    Hope this helps.
    Cameron

    Profile photo of Cameron_2Cameron_2
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    @cameron_2
    Join Date: 2003
    Post Count: 6
    August 24, 2003 - 3:15 am

    Just like to add ofcourse that the amount of money you can borrow is dependant on the bank’s value of your current property. For example if your property is valued at $500K and you owe $200K then you can purchase new properties for at least $800K. So your new loan size including original loan, purchase costs and purchase price would be just over 1 mill which is 77-78% of the value of your properties at say $1.3mill. Your mortgage broker would probably have to split the loans and securities with a number of lenders to get that loan size approved with lo-doc loans (if you need to include the rent income you outlined to service that loan size). You really need to see a broker to get the most finance possible.[;)]
    Cameron

    Profile photo of Cameron_2Cameron_2
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    @cameron_2
    Join Date: 2003
    Post Count: 6
    August 24, 2003 - 2:07 am

    Hi Bernadet,

    The diffuculty may be getting the lender to believe that your ppor has a rental return – unless you have lease agreements set up – usually no the case when you rent out bedrooms.

    So you might like to explore lo-doc loans, where you simply sign a stat. dec declaring your income, and the lenders take that figure for their calculations. This is good if you can’t prove your income. So you can include all income you get including that rent you recieve. I know that if you have $250K in net assets then some lenders does not penalise you in interest rates for a lo-doc loan. All you need to do is have worked for 2 years S/E. I got this loan and it is 6.47% interest only. Check that out. You can borrow up to 80% of the value of the security properties you are offering. Also I know that others lenders will also lend up to 80% on lo-doc loans and their interest rate starts at 6.8% then reverts progressively over 3 years to 6%. Depends on your strategy – beware of break fees on lo-doc loan though if you plan to sell short-term. I almost got caught.

    If you want more information just email me
    Hope this helps
    Cameron
    [email protected]

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