Forum Replies Created
Hi House Call
Hate to say that is incorrect.
The SISA legislation makes no comment about the type of loan one must take out.
Interest only is a popular loan type for investors who have limited funds in their SMSF and want to try and eak out a second purchase although i must admit i am very much one in the P & I corner for SMSF lending.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Derek is correct that many lenders run a mile when you mention the words NRAS however in saying that there are still lenders who will go to 90% lvr on a standalone basis.
Can't comment about Motion Property but same story get your Broker to order an upfront valuation so you ensure the purchase price and valuation are one in the same.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
New SMSF product released during the week where the lender has waived its application fees on its 80% lvr.
Makes the overall deal even more attractive.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi Gav
As the boys have pointed out financing a property using a newly formed Trust will not be a problem however you will be suprised how lending terms will differ.
All things being equal there is no reason why you shouldn't get the rate / applic fees etc as you would if you were buying in your own name.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Terry has hit the nail on the head.
Nothing in lending these days is simple.
What a lender did last week may not be the same as they do next week.
Normally upto 4 units on 1 Title can be done on resi terms although 1 lender will go to 6 (albeit they want a higher deposit amount). Of course there is residential terms and there are residential terms.
Take a lender like Anz they wouldn't touch even at a 60% lvr and with 2 unit on the same Title i.e Duplex wouldn't go past 70% lvr. To go to 90% you need a specialist lender or a lender that doesn't realise they even do such a loan and there are a few of those around.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi MBuilding
Firstly welcome to the forum and I hope you enjoy your time with us.
Have to disagree with Tom on this one as whilst nothing is for certain i don't think you are a million miles away of being able to go to a loan amount of $450K.
Course would depend on how we structured the loan and what you end up purchasing but assuming a standard yield i believe with a little tweeking it could be achieved.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi Luke
No hate to say you will only be able to claim interest on the original $300,000.
Off the top of my head and without checking the WA OSR website I am unsure as to Stamp Duty that would be payable on a transfer of the property to a Unit Trust for market value but it may be worth weighing up the cost with the benefit that would be received by being able to claim a deduction on the additional $400K borrowing (Plus Stamp duty).
Course you need to look at your current marginal tax rate as there will be an increased benefit the higher Tax bracket you enter.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Rick the loan will be secured over all of the units within the block so the amount you can claim as a Tax deduction will be based on the floor area available for rent.
I.e Assume that the area of the entire block is 400 Sq M and you live in 1 of the 4 units which takes up 100 Sq M then you would be able to claim 3/4 of the overall costs.
In relation to the loan it may still be possible to take out a standard residential loan but it would be credit scored so you are going to need 10% deposit minimum. I would probably suggest an interest only loan with 100% offset account.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Without full information it is difficult to comment with a degree of accuracy but either way i think i would be looking for an 80% interest only loan with a 100% offset account.
This will give you choice and options down the track as well as flexibility.
Certainly think of a couple of lenders who would appear to meet these requirements.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi Rick
Firstly welcome to the forum and I hope you enjoy your time with us.
Purchasing upto 4 properties on a single Title isn't an issue for a residential loan.
I own 2 blocks of units in Brisbane (1 being 6 x 2 and the other 14 x 1 + 4 x 2) and both deals at the time were done as residential loans (that story is for another day).
In relation to whether you can claim the FHOG i would have initially agreed with Shahin. In saying this i have just had a client do exactly as you are intending to do and he obtained in writing from the Qld OSR that "Yes" he could still claim the FHOG.
Suggest you make your own enquiries but as say this deal has now settled and he has additional funds.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
St George withdrew their Foreign Currency product some years ago which was a shame because it was a good alternative for clients earning non AUS $.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi Slow
Yes all of the Investor Club Brokers do that because they have no idea.
Why would you ever want to fund your retirement with debt / equity.
I prefer to fund mine with good old fashioned rental income.
Do not use a LOC as a product to fund your next IP as Terry mentioned it is fraught with problems.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi HC
Welcome to the forum and I hope you enjoy your time with us.
Whether you can afford to purchase another property and retain this as an investment will be based on serviceability and also available equity and without a lot of this information it is difficult for me to comment accurately.
The cost etc will again depend on the way forward although purchasing will involve stamp duty and selling will involve agency fees etc. Whether you can arrange a bridging loan will depend again on equity etc.
Sorry to appear non commital but as i say would need actual numbers to let you know your available options.
Then whether you decide to sell or retain the property will be upto you.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Davidts, why not drop Jamie a line off forum and get him to sort it out for you.
You certainly will be in good hands.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi Da
I can see why Suncorp Bank didn't do and certainly believe it can be done but would need a wee bit more information before i said Yes for sure.
Since the inception of NCCP I see many a deal declined each day and sometime the reasoning ehindb the credit decision would amaze you but i guess it is there money and not yours to be lent.
Doesn't worry me if you are in outer Mongolia as most loans are lodged electronically these days. In fact been a week or two since i have had a client from outer Mongolia so would welcome the change.
No Seriously distance is not a problem as email and phone works well.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
As Terry has mentioned certainly worth considering buying inside a SMSF dependant on your incomes and level of employer contributions.
You mention that you purchased an IP but you didnt mentioned whether their is a loan secured against it.
If not then i would use the equity in this property to raise a deposit and take out a standalone loan for your new IP.
If there is a loan then is your PPOR being used as security for this or did you put in a cash deposit.
Either way lenders will consider NCCP when assessing the deal due to your age but with the PPOR being owned outright i don't see that being a hurdle with many lenders.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
I don't think it is anyway as clear cut as that.
Personally i would go Interest only on both of the loans and link an offset account to one of them.
I wouldn't go with 2 separate loans as you are suggesting as this would involve cross collateralising the loans and I personally would look at 3 separate loans probably with 2 separate lenders.
Just to make sure your mortgage broker takes care in structuring such a deal as it is easy to come unstuck down the track if it is not done properly.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi Achiever
Firstly welcome to the forum and i hope you enjoy your time with us.
Your approach is fairly typical and one i started on some 15 years ago.
Similar to yourself i was fortunate enough to arrive from the UK when the GB pound was extremely strong and purchased our first PPOR and 4 Ip's for cash and then geared off the equity with cash flow to where we are today holding our current portfolio.
Irrespective of the entity you use (and i am thinking dependant on where the properties are located a DFT maybe the way to go) to purchase the properties in the loan structure is going to be important especially with the first deal or two. Also choice of lender is going to be imperative to maximise your serviceability going forward.
If you don't intend to purchase a PPOR for a while then I don't see an issue at all with the strategy.
You are welcome to drop me an email and I will send you a copy of the API article i did outlining my strategy in building my portfolio.
On a separate note in regards to the FHOG which State will the property be in ?
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi John
Both Jamie and I have already responded to the same post on the General property forum.
I suggest you only post it once as that way you will get a better response.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Maybe it is because AMP current lending policy is that any citizen that is not residing in Australia must have signed a Power of Attorney and provided a copy to the Bank before the application can be considered.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
