Hi tar_dolmaAs you'd know, your husband can offset his losses on the property he has an interest in, right now.  Your losses will accrue indefinitely, until such time as you start to earn an income again, when you will be able to offset your accrued losses against your income.As you have decided not to work, this has an effect on the total…[Read more]

Hi AlexOne way around your visa and associated low LVR challenge would be to "buy" a property on a Rent To Own (RTO) basis.  While you'll normally pay a premium to buy with a RTO it does get you into a property now, at a fixed cost and usually for quite a low deposit.The legal paperwork for a RTO is a residential lease and a call option.  Pe…[Read more]

Hi SunnyTo get your financial situation back into shape I'd be tempted to go with one of Terry's suggestions above, i.e. sell one of the properties with an Instalment Contract (IC).  This type of sale would get you an upfront deposit, fixed positive monthly cash flow of at least $500 per month (after all expenses) and fixed capital gain.With all…[Read more]

Hi LloydAll the above approaches work but we like to fix both our capital gain and positive cash flow.For example, I would buy a "standard" family home, in a solid working class area, i.e. well away from housing commission areas and with a low percentage of rental properties.  Preferably brick & tile and 3+ bedrooms.  I'd then on-sell this pr…[Read more]

Hi JacNothing too definite, they just seem easier to sell, i.e. they seem more attractive to our buyers.Cheers,  Paul

Hi HarryPrior to the 1 July 2010 there were various, State based, credit licences.  As of 1 July these State based licences disappeared, to be replaced by the Australian Credit Licence (ACL).  Therefore anyone who now provides credit or provides credit advice is required to get to get an ACL or become a Representative of an ACL holder, whether t…[Read more]

Hi JodiFour approaches are better than three, so here's another one I would buy a "standard" family home, in a solid working class area, i.e. well away from housing commission areas and with a low percentage of rental properties.  Preferably brick & tile and 3+ bedrooms.  I'd then on-sell this property with vendor finance so it generates inc…[Read more]

Hi AndrewThanks.  A Lease/Option is a set of paperwork used to control and possess a property.  With residential property, the paperwork used consists of a residential tenancy agreement (for possession) and a call option (with caveat) for control.An Instalment Contract uses a traditional Contract of Sale with a 12 or 13 page Instalment Schedule ad…[Read more]

Hi AllFollowing is some information regarding a question that's being asked a lot recently in the Vendor Finance world:Does my Vendor Finance business need an Australian Credit Licence?The new National Consumer Credit Protection Act requires anybody or any company who “in the course of a business” provides consumer credit or consumer credit adv…[Read more]

Hi NitAs you did not stipulate a date for the commencement of the Agreement, I believe the Agreement hasn't commenced.  Also Form 20a says: "If the appointment is a continuing appointment, you may revoke the appointment by giving 90 days notice in writing to the agent, unless you and the agent agree to a shorter notice period (but it must not be…[Read more]

Hi LenaBased on all the above, I'd probably stick with the property.  However if you did decide to sell, a traditional sale could be pretty disappointing in the current market.If you did decide on a sale, we'd suggest you use something like our "negative2positive" process.  It has the potential to allow you to sell your property at a premium pric…[Read more]

Hi DavidSome of the techniques used for Vendor Finance are:1.  An Instalment Contract2.  A Second Mortgage Carry-back3.  A Lease/OptionAs you mentioned 20% vendor finance as a deposit, I believe you're considering a Second Mortgage Carry-back (SMCB).  Our last two SMCB's were structured as follows:a.  20% of the purchase price was carried back…[Read more]

Hi rapapaOne challenge for all unit complexes is the effect the "fire sale" of one unit has on the valuation of all the units in the complex, i.e. you get one mortgagee auction where a unit gets sold cheaply and that effects the valuations of all comparable units in the complex.Numerically, you have less exposure to this type of risk in a smaller…[Read more]

Hi WynyardThere are a lot of Australians in your position, i.e. unable to get the deposit together that traditional lenders require.There are some properties on the market that are being sold with Seller Financing.  These properties usually require quite low deposits, with the trade off being you pay a premium price.I guess only you and your…[Read more]

Hi JeffI've got to agree with Terry and Ryan bacause you'll often find clauses from the Seller, in the Special Conditions area of your Contract, like the following:"Subject to Section 52A of the Conveyancing Act 1919 and the Regulations under that Act:(a) the purchaser acknowledges that any improvements erected on the property are being sold in…[Read more]

Hi AmyI'm with Richard and Ryan, i.e. if it were me I'd put this second IP into a Discretionary Family Trust.While you can't transfer losses out of this Trust, in the future, you could place a positive cash flow property into  the Trust.  In this situation the gain from the positive cash flow property could offset the negative cash flow pr…[Read more]

Hi KatieWelcome to the forum.  I'm sure you'll enjoy your time here.My wife and I started our Vendor Finance residential real estate business in 2003.  Some of the tools of this business are Options, Lease/Options, Joint Ventures, Instalment Contracts, etc.  Happily for us, I was able to give up my job early in 2009 and we are now both enjoy…[Read more]

Hi JacMYes you can do it.  The legal paperwork you need to accomplish is called a "Call Option".As you haven't outlined your exit strategy for your plan, I won't comment on your plan as, to me, it's not a plan without an exit strategy.  And you definitely need to have your exit strategy in place before you go into the transaction.As you mention t…[Read more]

Hi flare_windmillWelcome to the Forum. We all hope you enjoy your time here.Yes, you pretty much got it spot on.  However have a chat with one of the excellent brokers in this sub forum and you'll get a few other options to think about, e.g will you go for a line of credit or a facility with a 100% offset.  I'm sure they also suggest setting up a…[Read more]

Hi ojochoaI've got to agree with Terry.  We use Lewis for all our vendor finance transactions in Victoria.  His contact details are:Lewis O’Brien & Associates Suite 113 89 High Street Kew   Victoria   3101 phone: 03 9888 6388 fax: 03 9888 6366 Cheers,  Paul