Forum Replies Created
Hi Matt
Look forward to having a chat with you when i get back from the UK as i have a few ideas which might help you with such Income Acceleration.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi Dippa
Since we started First Home Owners Group in 2000 we have been offering Installment Finance to clients.
We charge a rate of interest based on a couple of benchmarks (depending on the client) but where we have borrowed money to purchase the property (In some cases where we do the loan inside our SMSF) this usually equates to between 1.5% and 2% above the standard variable rate.
When you start to build up cash flow like this you don't need many properties to make a decent Annual income.
Depending on the amount of available cash available you may be better off to consider either Vendor Financing or alternatively 2nd mortgage funding which comes with a higher rate of return.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Sorry Kevin just can't agree on using someone like ESuper.
Hate to say in the SMSF world one product doesn't fit all and the little quirks often required with a SMSF Deed you are better off using an expert like Jac M has mentioned.
Also i can tell you many of the SMSF lenders require Deeds to be re-written with organisations like ESuper and of course you bear the additional cost.
Sorry to repeat myself over and over again but YES you can buy land and construct a property or buy a house and renovate it. Just a matter of being fully across the SIS legislation.
I have done both as well as wrapped a couple of properties, bought and strata titled a block of 4, used my SMSF to provide 2nd mortgage loans etc. All totally legal if done properly.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Just gone past midnight in Qld so Happy New Year everyone and hope you all achieve your 2013 wealth goals.
Look forward to answering many more posts in 2013.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi Gemma
It is also possible to subdivide / strata title a property owning the entirely property in your SMSF.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi MK
It is exactly as Nigel has pointed out.
You can use a Line of Credit or what i tend to prefer or an equity loan as the rate of interest is usually cheaper.
As the equity loan is set up as a separate loan and interest only charged once you utilise the funds the repayment on your PPOR loan is uneffected.
Just make sure your Broker / Banker doesn't suggest accessing funds thru a redraw facility as you may end up contaminating the entire interest deduction.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi Donovan
Hate to say no you wont find too many books available as the current Superannuation legislation as it is ever changing.
I have just written an article for a Financial Planning magazine on some of the do's and don'ts of Superannuation can certainly email you a copy once i get back to Brisbane.
It covers areas like renovation, repairs, strata titling etc of property inside Super.
Certainly with the amount you have inside your Retail Super you have enough to start a SMSF and can easily diversify with gearing. Structured correctly you could keep the balance of funds in cash offsetting your SMSF property loan until you decide what to do with it.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Donovan it is for this reason i suggested you consider a SMSF.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi Paul
Yes almost a matter of getting what you dont pay for lol
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi Ross
Hard to know what Westpac will do as it is not their normal policy.
Normally i would say No but push them for a rate discount under the Pro pack using a DFT.
If not we can do it elsewhere.
Yes we can do an Industrial unit and the lvr will depend on whether it is owner occupied or investment.
Certainly for a cheaper rate of interest and set up costs you would want to try and keep the lvr to 70%.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
I think it all depends on what you want to do and the property itself/
Last couple of deals i have done have been complete renovation of a block of units which has involved a little more than a bathroom and kitchen upgrade.
Details of a deal i did earlier in 2012 (with actual numbers) is featured in the Jan / Feb edition of the API magazine.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Remember your Cost Base might need to be adjusted by the amount of any Capital Allowance you have claimed already whilst the property was rented out.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
No dramas Sandra just responded.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi Donovan
Just shot you an email with a copy of my SMSF ebook you were enquiring about in your other post.
In relation to the way forward i think you need to decide whether you want cash flow or capital growth in regards to an individual property acqusition or whether you want to pool the funds and look at a development project with others or merely want an annual return.
Probably more information need in regards to your initial goals before a more structured answer can be provided.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi Donovan
If you shoot me an email i will send you an Ebook i wrote on the subject.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi Mgsendon
The set up you have currently is par for the course and what we normally recommend to our clients.
I would however suggest a Interest only equity loan rather than a LOC as the interest rate would be cheaper.
Secondly if you intend to use a separate lender the loans will not be cross collateteralised anyway so no issues there.
If you are intending to purchase a further IP in 12 months or so i would make sure that your equity loan caters for this.
There are some good standalone investment loan products doing the rounds without any application fees etc so you should be able to source a couple of good products.
Not sure who your current Pro package is with but not all lenders are as competitive as you think especially with conservative valuations.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Totally agree Ben had a long running arguement with an Qld Accountant recently who had told our mutual client who was buying in Qld to put the Contract in the name of the Super Fund and wouldn't budge on that.
We spent 3 weeks telling him he was incorrect and then 2 weeks before settlement he listened and we got the Contract amended and somehow had the loan approved and settled.
Needless to say he is not using that Accountant anymore.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
No gets better Terry they had the 2 properties crossed but they told him that even though he had 110% borrowings the loans wouldn't be crossed going forward.
Must be magic.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Terry totally agree.
I have a couple of deals i have done for forum members where before i left for the UK we had the loans approved, loan documents issued and then 2 days before Settlement their existing Bank said we will cut the rate by 10 bps if you stay with us after all.
They have decided not to proceed after all.
As it happens post the December rate reduction they would have been better of in both interest rate and loan structure had they refinanced after all as the lender we recommend cut the rate even further than their existing lender but it is not only about rate as i say so often.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi Ross
Yes it is possible to do the loan at a 90% lvr although if it is done as a standalone deal the LMI might be fairly expensive.
If you are intending to keep the properties long term then might be an idea to do it as a residential loan rather than a Commercial loan as the rate and set up costs will be cheaper.
Have to remember many lenders will not allow multi units on the 1 Title so make sure your Mortgage Broker is au fait wiith funding such a project.
I have just settled a couple of similar deals with other forum members and the original lenders they were intending to use would not have done more than 2 units.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
