Hi Peter,
I haven’t used the two models that you have mentioned, but have had a Hewlett Packard 10B for quite a while and would recommend it.

It is an old model now, but one of my friends has just picked one up (discounted because it was dicontinued) for around $40. A bargain at half price!

Cheers, and happy cashflow calculations![]

Nathan.

Hi Gerard,

Low/No doc type loans were designed for self employed applicants, who through the assistance of a helpful accountant etc show a low taxable income, while in actuality they can afford to repay loan amounts which would require a higher taxable income.

Usually they ask for a declaration from the borrower as to their actual earnings (not their taxable income) and a maximum loan amount is obtained and then used from the declaired figures.

There are diferent types of low doc loans on the market requiring different amounts of documentation.(some also cater for ‘payg employee’ type applicants)

You will find that if you have been self employed for 2 years or more (holding an ANB as evidence) institutions will lend to a higher LVR than if you had a shorter trading history. LVR stands for loan to value ratio. ie how much as a percentage of the property you can borrow.

An easy example is someone who has been self employed for less than 2 years may have a maximum LVR of 65%. Where as if you have been self employed for more than 2 years you can borrow up to 80% of the value of the property.

There are quite a lot of different low doc loans out there on the market and they may prove a solution to your situation if your ‘declaired income’ can service the loan, and you have enough equity in another property you can use, or enough deposit available for the LVR on offer.

You also mentioned that you do not have a full time job. If you are part time or even casual you may still be able to qualify for a standard type loan product. Low doc loans are usually a higher interest rate that standard loans.

Hope this helps a little,

Cheers and happy investing,

Nathan.[]

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hi guys.
I think you can use the equity in the first houses you wrapped eg: if you depositted 5% for your first 4 wraps and they were all approximately the same price then you have 20% equity that you can use to buy your next property.

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Hi Stonewall,

Sorry, you can’t use the equity that you have in other wrapped properties for deposit + costs on a new acquisition. On another note if you only have 5% equity in an investment property you can’t borrow more against it as 95% is the cut off for investment lending (although there are talks of a 97% investment product comming out for strong applicants).

Cheers and happy investing,

Nathan[]

quote:

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I want to become financially independant in 12mths, and would like to know from you gurus out there that have achieved this, as to your frequency of buying (wrapping) houses? IE what is and isn’t realistic?

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Hi Hurricane,

I am not a guru or financially independant, but I am on my way.

I think that you are the best person to answer your own question. How much income do you want annually to retire on?

How many properties does that equate to?

Do you have the resources at hand to buy that many properties?
If not how will you overcome this problem?

Do you have the correct advice legal/financial that you need?

I am a believer that nothing is impossibe, and that your own success is a function of the amount of educated effort you apply towards your goals.

All the tools, and methods that you need are near by. Use them!

Happy investing,[]

Nathan.

I have been reading the posts and agree with all of them! On the building side of the coin, a few months ago I was talking to somone who was caught out. He purchased a brick 3 br unit without a building inspection and a few months later found that the building had underpinning issues which the body corp could not pay for. After all was said and done it cost just over 26K to rectify the problem!!![][!]

Happy and safe investing []

Cheers,

Nathan.

Good to know the name behind the initials! Thanks for your posts and sharing your wealth of knowldege.

I must admitt though when I read the title of your post, i thought it would be a slightly differnet confession!![][]

Thanks and cheers,

Nathan.

Happy Investing!!!

Hi I will have a stab at this, but you would need to talk to an accountant etc about taxation effects etc.

Starting on no 2 first. I believe that the articles that you read that suggest to put all IPs in the highest income earners name assume that the IPs are negatively geared. Important distinction if you are considering positively geared properties at any time.

Now number 1. Yes you can ‘move equity’ from one property to another by (most commonly):

1) Refinancing your current loan to a higher amount.
2) Getting a top up on your existing loan.

Both of these methods give you access to money for deposit + costs on the new purchase.

The taxation effect of this (deductablility of loan interest)is where you will need to seek advice from someone more wise in these areas.

I believe that you can obtain a tax deduction of up to the origional size of the loan. EG if your current 110K loan was origionally 150K, then if you decided to increase your mortgage to 250K for example you would only get tax benefits on 150K.

Also watch out for mortgage insurance if you are considering increasing your mortgage above 80% of the property’s value.

If someone is better versed on tax deductability of loans in this circumstance please correct me if needed.

Hope this helps in some way.

Happy investing[]

Nathan.

Hi Gavan,

You are right, it is a very hard question to answer without delving deeper into your situation and your goals.

In general though, if you have a principal place of residence and want to pay the loan down quickly, then you would need a flexible type loan. If you were hoping to reduce the debt on your investment property in the same manner then the same sort of loan product would be suitable.

If you are more concerned about reducing other debt you hold (eg owner occupied home loan) and the loan you have/ or are considering is an investment loan, then you may want a more basic loan (at a cheaper interest rate) which would allow interest only payments.

I must stress that it is very hard to answer your question without knowing your current position and future goals, but in general what I have said should hold true. ie only pay a premium on the interest rate for features you will use.

Cheers,

Nathan.

P.S If you want a more specific answer fill me in on a few more details / goals.

Hi Pete,

Also have you investigated finance for the factory? You may find that the rates are not as compeditive as home loans, and that the required deposit is 25% ore more!

Cheers,

and happy investing[][][]

Nathan.