Forum Replies Created
Morning!
I'm not a broker but if your investing with this reason in mind; "i am thinking long term so i can protect my assets for the future and then pass onto family beneficaries also" then a trust structure with a corporate trustee is the way to go.
If you purchase in your own name then it's just another asset that can be taken away from you.
Did you happen to look at the property evaluation that was compiled for the bank?
Try and find comparative sales in the area that best match your property, if you think that it's worth more then what you’re being offered then ask.
I too had what I thought was a low evaluation from a bank but then saw that there wasn't any recent comparative sales so I guess the evaluation was conservative for that reason.
So over a period of 4 months after the conservative bank eval, 2 new units and one new house similar to mine sold in the same street as myself, I then paid for a independent evaluation done in 'lending format' (a.k.a a 'Residential Evaluation and Security Assessment for mortgage purposes') took it back to my lender, it was accepted and wasn't a drama. (the difference between the 2 evals was 50k)
This slightly varies from your situation as you don't actualy own the property but if you think it's worth a bit more and the bank doesn't want to show you the report, in specific the 3 recent comparative sales within the report then I’d go shopping!
I'm just sharing my experience, hope this helps!
tuggerwaugh wrote:Thanks for both your replies…good info… If I use my equity as a deposit does that mean I can still avoid the LMI if I deposit more than 20% of the value from the equity I have acquired? I am trying to decide whether to throw all our incomes into the 2 mortgages now and use the equity as a deposit, of make minimal payments and save for a deposit with cash in hand. I suppose being able to reduce my LMR to 80% is the most important aspect. Cheers
TuggerwaughRemember if your trying to avoid paying LMI on anything then you not only have to have atleast 20% deposit/equity on your current IP's but you then also have to have a 20% deposit on your new property.
Break either one of those ratios and you'll be forking out for LMI.
Your mortgage would increase to $770,000 and so would your repayments.
Simple answer when unlocking equity;
If your looking at purchasing another IP worth $70,000 then you'd be wanting to draw down on your equity (setting up another loan/line of credit) and therefore your repayments to the bank would increase accordingly..Lets just say its an interest only loan and the interest rate is 7.57% on 70,000 then that would be an extra $5,299 per year or $101.90 per week.
But in all honesty I think you'll have to wait for your properties to increase more in value before you can unlock $70,000.
You would need to speak to a bank or a broker about the costs involved (specificaly what the LMI costs would be) but I'd say it would be a costly exercise trying to unlock 95% or more (if possible) of your current equity, even at 90% the lenders mortgage insurance would still chew up alot. This to me wouldn't make your current exercise worth it.
p.s. I'm not a financial planner/advisor nor a broker so I hope I haven't stepped on any toes!
I've recently had a place (12month old brick house, good suburb) refinaced with the same 'Reduced value next 2-3, 4 stars out of 5' rating.
I was thinking about refinancing to 95% but decided only on 90%, bank approved the evaluation and paperwork should be complete next week or so.From my personal exprience I couldn't see a 80% loan being an issue at all.
Goodluck!
Update; Evaluation was accepted and the loan approved
Here's my re-evaluation story…
1 property, 2 evaluations, 3.5 months apart, 50k difference between both and all I did in capital improvements was dug up a few weeds from my lawn and re-stained the decking…
What pushed the price up? To my knowledge the lenders comparitive sales. It took the sale of 1 house and 2 units in close proximity to my house to push the value up.
(Please note that the 2 evaluations were completed by 2 different company's and the first was through a bank and the 2nd (the later) was done on my own back. Although I didn't get a chance to compare the two in detail I did get a chance to see the comparative sales on both re-evals.)I don't think a time frame is relevant in a re-eval, only recent comparitive sales. (although I could be wrong)
I would keep a close eye on houses/units/real estate in general in close proximity to your property and what they go for.If your looking at re-financing and having your own evaluation done make sure you have it completed in a format for Mortgage purposes. Also ask the company doing the eval which banks they do evals for as this could hint as to where you could go re-finance hunting!
I'm no property expert but just wish to share my recent re-eval/re-financing experience,
Hope this helps!
Joel.
Hi, unsure about the proposed “in nominee” on the contract to avoid personal CGT upon sale but maybe you could try on-selling without involving an agent? this could save $$$
Just out of curiosity where abouts is the land, in Victoria?
If so what size are the blocks and how much would you take on a 30 day settlement subject to finance?
p.m. me with details thanks.
To cut a long story short I overpaid stamp duty because the vendor signed a stat dec that was prepared for him with the incorrect land value on it. (There was a typo which saw an extra 100k added on)
To correct this matter DO NOT let your bank manager tell you that "We'll handle the matter for you". I think in the last 7 months I've made 30 phonecalls trying to chase the matter up (progress check up phone calls) and unfortunately it was a big waste of time.
I learned this the hard way and so I took on what I thought was only a matter that the bank could resolve, when infact refund process is infact quite easy and can be arranged by yourself in a few days…
Firstly you need to get in contact with your conveyancer/solicitor, preffereably meet with them and sit in their office while they call the vendors conveyancer/solicitor and request them to prepare a new stat dec stating that the old stat dec was infact inorrect and also the actual land value. Have the new stat dec signed by the vendor and posted to your conveyancer/solicitor's office. Also have your conveyancer/solicitor arrange through the RE Agent a land valutaion to verify that the land value is around what the vendor has stated.
Once these are in order, send the new stat dec and a photo copy of the RE Agent's valuation along with the form from the below website to the address on the form.
http://www.sro.vic.gov.au/sro/srowebsite.nsf/revenue/Gen-Form-1/$FILE/Gen-Form-1.pdf
Over the phone the SRO duties payable department will tell you to expect a refund turn around time of about 6 weeks but the turn around time for me once these documents were sent in was around 3 to 4 weeks.
Thx peeps, I’ve contacted my solicator and she’s got things undercontrol. There seems to be a mixup between my bank and a stat dec that was signed by the builder.
For some reason I’m guessing my bank has just gone by SD displayed on the Stat dec and not bothered with double checking it, but this can’t be confirmed.I’ll keep you poseted on whatever the exact mixup was…
Just a thought for next time, I’ll do my own SD check and not sign the contract till it’s right!
