Forum Replies Created
Yes thank god but there are a million investors.
Personally i cant keep up with the demand and hence dont get chance to post as often as I would like.
I agree though if you relied on FTB for your business i think you would be going hungry.
Richard Taylor | Australia's leading private lender
Hi Slallen
Sorry to hear about your previous experiences with Mortgage Brokers.
I know it is easy to be wise after the event but personally I would never take anyones word for the fact that the deal has been approved. I always email or fax to my clients a copy of the approval advice from the lender so they have it in writing.
It is difficuly to comment about your current position without knowing your income and other personal details
i appreciate some of this is personal information and you may not wish to post it on a public forum.
Richard Taylor | Australia's leading private lender
Yes in Qld it is around 2.7 x as much as if it was for an owner occupier.
Richard Taylor | Australia's leading private lender
Frugal one
Hate to say that wont do you much good as each lender has it own panel of valuers and unlikely they will go outside this.
By all means find out who is on your lenders panel and try and arrange a valuation on the property and then get your Broker to use the same valuer when the Bank do their own valuation.
Richard Taylor | Australia's leading private lender
Normally maximum refinance would be 90% so in that case minimum 10% paid off or altenatively the property would have need to have increased in value to allow a maximum of 90% of new valuation.
Richard Taylor | Australia's leading private lender
Normally maximum refinance would be 90% so in that case minimum 10% paid off or altenatively the property would have need to have increased in value to allow a maximum of 90% of new valuation.
Richard Taylor | Australia's leading private lender
Regretfully no way of reducing the Stamp Duty which is charged on the Transfer value or valuation which is the higher.
Richard Taylor | Australia's leading private lender
Personally i would be borroing the full amount and use your own cash proceeds to place in an offset account.
The net interest amount paid with the right lender is exactly the same and you still have the flexibility of immediate access to your own cash funds if needs be. You also preserve the full Tax deductability of the interest.
Richard Taylor | Australia's leading private lender
Harry no that is incorrect.
Many deals are done with Title in one name and the loan in joint names.
Normally need to be some related party interest or benefit to the party concerned.Richard Taylor | Australia's leading private lender
Yes i most cases depending on the loan amount.
It is not just the rate that is important but the structure of the loan.
Local branch wont have a clue and even if they did wouldnt care less anyway.
CBA have been promising a fully transactional offset account for the last 2 years.
Richard Taylor | Australia's leading private lender
GOM
It is simple the MISA offset account from CBA is not fully transactional and has minimal amounts you can transact from.
There is no nipping up the road for a curry and whiping $35 out of the whole in the wall.
The Anz One account beats the MISA hands down every time.
Richard Taylor | Australia's leading private lender
Hi Jess
Of course the 3rd option which we havent discussed and probably should would be to consider buying the property in a Discretionary Family Trust with both of you as Trustees and beneficiares. The 2 children would also be beneficiares.
Course downside is whilst the property is moving from negatively geared to positively geared you need to come up with the shortall as any losses are closetted within the Trust.
Flexibility can be key in a deal like this and the ability to move with the times might be worth forgiving the short term cash flow gain for the long term ability to distribute capital growth accordingly.
Richard Taylor | Australia's leading private lender
Veronica flexibility is the key to investing and structured correctly there is absolutely no downside to the way in which i suggested you go about this deal.
Again LMI would not be payable even though you are borrowing 100% + of the purchase price as you are using collateral security to fund the 20% deposit plus costs.
There will be no increase in interest costs and will mean you could always use your cash savings to go again if needed for the next deal.
Richard Taylor | Australia's leading private lender
Hi Vinny
The Bank or your Broker should have split the loan between the $190K deductible debt and the balance.
This way it would be fairly easy to apportion the interest as the Bank will charge the 2 accounts separately.
Yes claiming a deduction on the higher non dedcutible is cerainly likely to lead to a few ATO hard questions.
Get your Tax agent to put in a variation for the previous years after he has re-worked the elligible deductions.Capital Gains tax is based on the original purchase price (plus stamp duty minus any Capital Allowance already claimed) and has nothing to do with the refinanced amount.
Richard Taylor | Australia's leading private lender
Heather could you please name the investment company you purchased thru so other forum members can see whether they want to pay $30K over the odds for the service and rent guarantee.
Richard Taylor | Australia's leading private lender
Assume the purchase price of the new IP is $300,000 and purchase costs come to $15,000.
You parents take out a loan of $75,000 and use this to pay down your PPOR.
In turn you then apply for a new interest only loan on your PPOR of $75,000.
(You turn your currently PPOR loan to interest only with 100% offset account to free up monthly cash flow.)
You use this $75,000 on your new IP to cover the 20% deposit and the acqusition costs.
You then take out a loan for $240,000 being 80% of the new purchase price.
Purpose of the loans are for investment so the interest on both loans are deductible.
You pay down your parents loan as quickly as possible.
This way 100% plus of the interest charged on the new IP is deductible and your parents property is used merely for the 20% loan plus costs (Yes some family guarantee loans can be structured this way).
You parents have the flexibility that they can reborrow against the property to fund their own investments.
As mentioned doenst sound like your first mortgage broker had any clue about investing structures so make sure your next one has some experience.
Richard Taylor | Australia's leading private lender
Johhny
Hate to burst your bubble but unless the securities are cross collateralised no lender is going to lend you 100% of the purchase price allowing you to use your savings as deposit for the renovations.
If the work is being done on a fixed price basis you might find a lender be preapred to advance stage payments based on the increased value.
Also your available equity is not the same as your useable equity. Most lenders wont go past 90% lend on a refinance.
Richard Taylor | Australia's leading private lender
Hi Veronica
I certainly would not be using any of you own funds to purchase the property and would be looking to borrow the full $600,000 plus acqusition costs.
Split the loans between an 80% loan on the new IP and the balance secured against your PPOR.
Place you current savings in an offset account linked to the IP as this will have the bigger loan.
If you use your savings you will have used them forever however if you use borrowed funds you will have flexibility in case your own circumstances change in the future. The net interest position will be the same just with more flexibility.
Think carefully about whose name you put the property in.
You might even want to consider a Discretionary Family Trust if you feel that the property will be getting close to positvely geared especially with you at home and a dependant who could be a named beneficiary.
Just make sure you mortgage broker has some knowledge of investment structuring as poor advice at this stage of your investing life will have an effect on your future.
Richard Taylor | Australia's leading private lender
Sorry why would you put in a $100,000 in as a cash deposit when you have a current non deductible home loan.
Why would you not pay down the existing loan by $100,000 and then borrow $100,000 as an investment loan to get $100,000 of deductible interest.
Richard Taylor | Australia's leading private lender
Matt
A Credit License is required in WA for undertaking instalment finance and due to the constraints and costs most investors do not offer such products in that State.
We are also receiving more and more enquiries from clients in Qld who are seeking Wrap terms and suprised at the quality of the type of client the applications are coming from.
Richard Taylor | Australia's leading private lender
