So long as your lender allows it – split the existing PPOR into two components – portion 1 for PPOR use, Portion 2 to be used for the investment funds. Rough number example in an example where you would use 250k:

Initial Loan:

*400k loan facility, 150k loan remaining, 250k in redraw available

New Setup:
Loan Split 1 (ppor debt):150k facility,…[Read more]

Assuming the valuation of the property comes back at $360,000 – a 20% deposit + government charges equates to ~$84,000 – a tad short of the 100k you’re being told. So either there’s a valuation shortfall or something else at play.

Apartments in the Gold Coast have been the butt of jokes for sometime now – for many years many investors dreams were…[Read more]

Hi Amanda,

Welcome to the forums – great working starting to look at investing. You’re definitely on a low income – but this doesn’t necessarily preclude you from buying an investment property at the level you’ve estimated the purchase to be at. A quick run of the calcs show you should just scrape by and a guarantee wouldn’t be required.

The…[Read more]

Colin has hit the nail on the head and identified the many issues with joint ownership of property with non spousal partners – there’s so many gotcha clauses and negatives which limit the long term potential to grow an investment portfolio.

The basic TL;DR is that you’re going to have your friend as either a borrowing co-applicant or guarantor,…[Read more]

Someones Hungry Richard! ;)

Reminds me of the private money lenders who spam our email inboxes daily.

Another pro/con (its on both sides of the coin) – is that the finance is different to normal residential lending. In terms of deposit requirements, costs and the like it can be more onerous and restrictive, but by the same virtue being a commercial loan means the way borrowing capacity, income verification etc is treated differently which can…[Read more]

Having the appropriate structure will allow you to achieve a few different things:

*minimise lender policy risk/structure risk
*increase your borrowing capacity
*due to the above, grow your portfolio sooner and further than otherwise.

The major points are to avoid cross collateralisation, respect tax laws/accountant preferences, diversify…[Read more]

Agreed Richard – an appropriately setup structure will not need to use a LOC these days, there are some minor times when they can be of use, but for the most part are a relic which has fallen to the way side compared to a 30 year term loan, interest only with fully transctional offset attached.

I’d be surprised if she’s still reading all the threads on the forum 9 years later. :)

Ballarat has had some previous run ups in prices – it does come down to whether you think theres going to much further flow on from prices or whether they’re going to moderate until the next boom.

I wouldn’t rely on your friends advice on where to invest – if you’re buying an asset potentially worth hundreds of thousands of dollars it’s worth…[Read more]

Sydney has had quite a run up (and Melb for that matter), but the fundamentals for Melbourne over the long term certainly does make it an attractive play. Lisa Parker in Melbourne from http://www.parkerinvest.com.au is worth having a discussion with if looking for a buyers agent expert.

Declining inflation, a sluggish economy – I can’t see the metrics pointing to an upshift in rates until there is a significant change in the macro data.

Just like most regionals – you have to ask what is going to drive the supply/demand equation to give you long term growth if there is near infinite land available for expansion and limited long term population growth.

What draws you to the area?

Is the intention to purchase this via cash, or having enough unit holders/investors to pay cash for any proposed purchase? Any group/syndicate purchase with finance can cause a nightmare for all those involved for their personal finances thereafter as each party will be liable for the entirety of joint debt in borrowing capacity calculations,…[Read more]

Definitely Jamie Moore from Pass Go if you’re in Canberra. :)

And that’s the way fixed rates should be looked at – a risk mitigant. That is completely different to the OP’s question however which is based on rate differentials, which with the latest cut alone would have seen them worse off. Use fixed rates to manage risk, not gamble for the cheapest option.

Good value in Bridgewater right now – would be a good idea to get into there sooner rather than later. Our PPOR is over in Crafers and the market is trending quite healthily upwards around the Stirling-Crafers-Aldgate section, this will no doubt flow on to Bridgewater and surrounds.

Where abouts in the Hills do you have it dtrain – Bridgewater, or further out towards Mt Barker?

Depending on where you would be looking for a PPOR vs your investment location would dictate a lot – if one market is rising much faster than the other it makes it a lot easier to choose which pathway to go down.

It does happen a lot unfortunately Colin.

There was also a certain big 4 bank who encouraged when they brought out their transaction offset account, to release all of their redraw into their offset account (as it was the same but even better!). That would have caused a lot of potential tax problems for a LOT of people.

There’s no cut and dry best option for a structure – you’re going to need to get specific advice from financial advice, lending and tax perspectives.

Exit planning and buy/sell agreements are very common in these arrangements, particularly with farming assets. Don’t short change yourselves by relying on an internet forum (or a real estate agent)…[Read more]