Forum Replies Created
Isiah Yes MISA is to offset accounts as the Robin Reliant was to motor vehicles.
Sure it will eventually get you there but you might get frustrated with the time taken.
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Yours in Finance
Richard Taylor | Australia's leading private lender
I must admit i am concerned why there is still a couple of hundred of dollars shortfall after you have purchased another IP.
Are you sure you are claiming all you are entitled to ?
I will also assume you have done the numbers on a part or full Spousal Transfer considering the CGT and SD.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Thxs Peachy appreciate the comments.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Rather than buy up big in Cooper Pedy you always look to take up a few long term Call options.
Reduce your risk yet maximise your opportunity.
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Yours in Finance
Richard Taylor | Australia's leading private lender
As Terry has mentioned as long as you realise once you pay down the debt if you need the funds back the interest wont be deductible.
I decided 17 years ago to pay down all of my IP debt and must admit i do enjoy the monthly cash flow.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Totally totally agree with Terry as you will be surprised what documents a Bank can pull out and show you that you signed them when you opened when times get tough in the business.
Just because the mortgage is upto date doesn't mean your home is not at risk.
Lenders seem to have selective deafness when you want to increase the overdraft for a week or two because you have a couple of slow paying creditors and they know you have no where else to turn.
Do yourself a favour and don't put yourself in that position.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Dave depending on the what your long term objectives are you could well find that the property would suit a purchase, rent and then sale by Vendor Finance strategy.
This is one of the income accelerators i used to build my buy and hold portfolio.
Of course in saying all of this if after talking to a local property manager you feel that the area will cause you more problems that it is worth then it wont matter what the potential for longer cash flow will be it could just be a matter of giving it a wide berth.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Shahin old mate The Dragon doesn't do a Non Relocation loan where an owner builder is involved.
Trust me Max is in Brisbane and we have been down that path.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Wow wish my Landlords Insurance bill only came to $2500 / Annum ……
Unlike Life Insurance where there is a defined guarantee of payment (although regretfully you may not be around to enjoy it) House or Landlords Insurance has no such guarantee. It is a payment for what could be a non defined risk occurance.
With every client i talk about risk minimisation and what you can do eliminate the risk as much as possible.
Getting a Building & Pest Inspection done when you go to Contract reduces the risk of problems before you settle.
Fixing your interest rate gives you a guarantee that your monthly repayment will not increase for a given period.
The list goes on.
Personally i wouldn't buy a property and not take out the relevant insurance.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Personally I would run a mile.
Will depend on what your fathers investment objectives are as to what and where he purchases.
I am not sure why can only spend $150K but assume there is a reason.
Depending on his age he may even want to think about setting up a Self Managed Super Fund.
Make a deductible contribution to Super (within maximum limits) and look to purchase inside the Fund.
Hard to comment without further details.
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Yours in Finance
Richard Taylor | Australia's leading private lender
I agree it is impossible to answer with any form of confidence or accuracy without knowing the conditions of the Contract.
If you feel that the rent is slightly higher than market rent are you not better off to reduce the rent and meet the market rather than let the property get stale whilst you are arguing over the terms of the contract.
Whilst i understand you can offset the lack of rent in your Tax Return I am a firm believer of trying to maximise the occupancy of the property. You can always increase the rent at the end of the 6 or 12 month Tenancy.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Richard i hate to say that is simply not the case and is a myth that many investors when they first start out believe in.
Regretfully it is simply not true as every lender requires every Trustee (and with some lenders every Adult Beneficiary) to guarantee the loan and then going forward every lender requires you to disclose any previous guarantees.
The exception with certain lenders is where you provide a personal guarantee in your capacity as a Trustee when doing a loan within a self managed super fund.
Tread carefully going forward as all that glistens is not gold.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Deerinpj is there a reason why you would limit the lvr to only 80% ?
I am assuming you have bags of equity in your PPOR and don't envisage running out of equity to fund future acqusitions.
Whilst you may save a couple of deductible dollars on LMI it might also be a lost opportunity cost going forward as extracting the equity on the IP's down the track may be harder than you think.
If required it is always a lot cleaner to take a 90% lvr from day 1.
In regards to valuation remember the valuation figure provided is only 1 small component of what a lender looks at.
The valuation can come upto purchase price and the deal may still not get doe as it is the emphasis on the Risk Ratings that lenders and insurers look at.
I agree i prefer East Toowoomba or even Mt Lofty and that side of the range.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Jane away from the property itself ( as i am sure others closer to you will comment ) make sure your Broker / Banker structures your loan correctly as you want to ensure that the loan is set up correctly from day 1.
Just because the property starts out as being a PPOR you know you will rent at the end of the day so ideally want a Interest only loan with a nice high lvr and the flexibility of an offset account assuming you do not buy another PPOR.
Course in say this make sure you don't end up paying for a feature that you aren't going to get value from.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Pay attention to what Jac M says in the area of Geelong as she owns half of the City.
The other half she currently has options on …………..
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Yours in Finance
Richard Taylor | Australia's leading private lender
Richard go that route and your finance options become less and less.
All you need is to hit serviceability wall with one lender and you could struggle to find another one come to the party.
I can only thing of half a dozen lenders that would knowingly accept a deal under an HDT structure.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Sorry for the delay but been flat out last couple of days.
Was actually up in Toowoomba on Tuesday looking at a property for a forum client and then the following day got a contract in from another member.
Second biggest City on Qld and certainly the gateway to all towns East.
There are certainly some excellent areas and some i would probably steer clear of.
Have had problems with the mortgage insures in Toowoomba so want to make sure your Broker runs off a valuation prior to lodging the deal for you to ensure there is nothing adverse in the Risk ratings.
Rate of return is about right so if the suburb is ok not a bad start to your portfolio.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
The only factors that prohibits an investor increasing his portfolio is a combination of lack of equity or lack of serviceabillty.
If these circumstances can be overcome then you can carry on purchasing.
Of course the appropriate lender choice can have a big bearing on your loan planning.
We are working with a couple of lenders that are offering blended loans meaning the investor can borrow 100% of the purchase price thru a combo arrangement.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hate to say getting a second valuation wont do you any good as the loan is still based on the lower of the two figures.
Got one here in Brisbane where the valuation came in at $40K over the purchase price (Very unusual) however we can initially only lend against the purchase price. Nice for future equity release though.
Depending on the numbers and you own particulars with an initial 10% you could possibly borrow circa $105,000 against the property and then piggy back the funds onto the next deal without having to wait for the equity release.
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Yours in Finance
Richard Taylor | Australia's leading private lender
There are also lenders that offer an unsecured credit card facilty with the investment loan charged at home loan rates.
These funds can then be placed in a 3 month Term Deposit Account and used as genuine savings on the next purchase .
We are currently working on a 100% blended loan in conjunction with a couple of lenders that will be ready for release shortly
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Yours in Finance
Richard Taylor | Australia's leading private lender
