Forum Replies Created
Terry
No nothing is exempt in Qld i assure you lol.
Richard Taylor | Australia's leading private lender
Hi start
I wont comment on the project at this stage as I am still in the UK for another day or so and under 12 inches of snow the thought of the warmth of Port Douglass has made me quet envious. Cant wait to get back to Brissie.
Couple of points worth noting:
1) If the purchase price includes a furniture package it is very unlikely that your lender will value the property at purchase price so you will need to come up with the shortfall.
What you want to ensure is that the valuer doesnt value the property at a figure less than the purchase price minus furniture cost.
Get your mortgage broker to undergo a Bank valuation on the property prior to going to Contract so you can weigh up the deal without it costng you anything.2) If the property has a 5% net return guarantee built into this again may reflect in the purchase price.
Believe it or not many lenders have a clause in their mortgage documents which prevents you from leasing the property for more than 12 months at a time so you might have an issue with this also.
The mortgage insurers will not like the property if it is required to go into the management pool and you will unikely obtain a 90% lvr.
All in all i think you should check out your finance options first as most lenders will run a mile at the sound of managed investment.
Richard Taylor | Australia's leading private lender
I am with you Terry still trying to figure out what Nancy was selling ?
Richard Taylor | Australia's leading private lender
maybe one response is enough.
Richard Taylor | Australia's leading private lender
Guess it all depends if you want someone to take your money of you recommend some cross collateralised line of credit loan and then point you in the direction of an overpriced property.
Sorry but i have too many ex Destiny clients that have been lead up the garden path with strategies that were inappropriate for their circumstances and had to spend time unraveling their positions.
If you want to clarify a little more about what you are seeking i might be able to help you further.
Richard Taylor | Australia's leading private lender
I agree with Terry.
It is not the issue obtaining 100% of the purchase price but the associated costs that is the issue.
Even with an exemption on the stamp duty the loan costs are the ones you will have an issue with.
Remember 100% loan does not mean a 100% loan.
Richard Taylor | Australia's leading private lender
Hi D
Yes Stamp Duty will be payable on the portion being purchased and potentially Capital Gains Tax on the increased value.
Just out of curiousity what were the Tax changes which is forcing your hand here ?
Richard Taylor | Australia's leading private lender
Yes a considerable difference.
A Commercial loan cannot be mortgage insured so means you would be limited at best to an 80% LVR.
In todays climate this is more likely to be back to somewhere around 65-70%.As Terry has indicated it may well be that depending on the size of the apartment you will again be limited to a similar LVR as you would with a commercial property.
Richard Taylor | Australia's leading private lender
Yes a considerable difference.
A Commercial loan cannot be mortgage insured so means you would be limited at best to an 80% LVR.
In todays climate this is more likely to be back to somewhere around 65-70%.As Terry has indicated it may well be that depending on the size of the apartment you will again be limited to a similar LVR as you would with a commercial property.
Richard Taylor | Australia's leading private lender
Joe
I now Nambour well as my daughter was born at the Hospital there some 15 years ago.
Regretfully i cant recommend a suitable agent sorry. Brissie would have been a different kettle of fish.
Richard Taylor | Australia's leading private lender
No Australian lender wil take overseas property as security.
If you lived in Vietnam you maybe able to get a loan with Anz Vietnam.Nothing to stop you taking out a line of credit on your Australian security and using the funds to buy overseas.
Fraut with problems but doable.
Richard Taylor | Australia's leading private lender
Joseph
Where in Qld is it ?
Richard Taylor | Australia's leading private lender
Did you or your Broker not undertake a private valuation before proceeding to Contract f not i think you ave been badly advised.
Would never say to a client in the current market to go unconditional purely on a pre-approval especially from the CBA who are notorious in down valuaing their properties to redce the LVR's.
Also find the CBA a strange choce for a PPOR as they dont have a fully transactional 10% offset account but i guess they do stil pay overrde commssion so maybe that was the reason for the Brokers recommendation.
Obviously i hope the deal goes thru for you but stil think the decision to go unconditional without a valuation is unwise.
Richard Taylor | Australia's leading private lender
Just be careful as many lenders require that all Adult beneficiaries (THATS right beneficiaries) Guarantee the loan.
Your mortgage broker should be able to recomend lenders that have less onerous requirements and costs when it comes to Trust structures.
Richard Taylor | Australia's leading private lender
Hi there
Just because the finance has been approved at a lower figure than the initial purchase price does not mean you brother has to take it up and settle on the property. Normaly the finance needs to be approved on Terms acceptable to the Purchaser whereas in this case this was clearly not the case.
Normally within the letter of offer the terms of remuneration for the Broker will be outlined although the Broker also has a duty of disclosure to advise the client upfront of how he or she will be getting paid.
Personally i would never deal with a Broker who is related in some way to the selling agent or in this case the same person as there has to be a conflict of interest.
Easiest thing to do is to get your Brothers Solicitor to write to the Sellers Solicitor and advise him that he is NO longer proceeding. Then personaly if i was your brother I would be getting an altenative Mortgage Broker to look at his finances independantly and advise him away from the confines of the selling agent, display home etc.
A Broker should be acting for you the purchaser and have no beneficial interest in the sellers activities.
All sounds a bit close to me.
Hope this helps.
Richard Taylor | Australia's leading private lender
Hans
Yes buying an invesment property first does not preclude you from qualifying for the FHOG down the track when you come to buy your own PPOR assuming all other conditions of the Grant are met.
Of course if you go to Contract on your PPOR after 1 July 2009 then the Grant could be back to $7000.
Richard Taylor | Australia's leading private lender
Free
Couple of points:
Many clients rush in and we set up a Discretionary Family Trust with a Corporate Trustee on the basis that they intend to buy +cashflow properties.
Then they decide that the property they are looking at is in fact negatively geared and they want to be able to claim the negatove gearing on a monthly basis. They consider a Hybrid or Unit Trust structure.
When they have signed the Contract they approach us again to arrange the finance and do not realise that in the current climate that many of the products offered are not available to Trust Structures. Most lenders want to charge upfront for their legal dept to review the Trust Deed to ensure it has satifactory borrowing powers.
Had they purchased the property in their own personal name then such restictions would not be with us.
Dont get me wrong i am not suggesting that one does not use a Trust structure for property acquisitions in fact i have 5 seperate Trusts i use for my portfolio however all i am saying is before you rush in think about what and how many properties you are likely to buy.
If you only ever buy 1 then why not consider a DFT with you as personal Trustee especially if the property is neutral or positively geared. Each client is different and individual circumstances need to be consdered when providing such advice.
Richard Taylor | Australia's leading private lender
Hi and welcome to the forum.
Firstly congratulations on wanting to start your investing career so early and I take my hat off to you.
Unfortunately the days of the 100% loan whilst not yet been and gone have requirements that are fairly stringent in respect of credit and asset requirements.
There are only a couple of lenders left offering such a product and all require evidence of a 20% equity stake in other property or cash assets.
So on the basis the maximum loan you can obtain would be 95% + LMI you would need to come up with 5% deposit plus your acquisition costs.
Given this will be close to the amount you have saved why not think about buying for all intense and purposes the property as a PPOR obtaining both the concessionary Stamp Duty and the $17K FHOG in Vic.
As long as the services are all in your name and the you nominate the property as your PPOR for 6 months in the first 12 months after settlement you will have satisfied the FHOG requirements. You spend 6 months renovating the property although you would not have been able to obtain a rental income in that time.
Work out what 6 months rent would be and I bet it is considerably less than $17K.
After 6 months the property could be rented out and you then have the 6 year applied in respect of any CGT.
You could look to take out a 95-100% loan (which will be available being your PPOR) and take this on an interest only basis with 100% offset account attached to to protect the future deductability of the loan.
Obviously without more individual information it is difficult to provide you with a clearer answer.
Drop us a line if you need any additional information.
Richard Taylor | Australia's leading private lender
Hi forsen
Firstly welcome to the forum and I hope you enjoy your time with us.
I wont go down the tracking f asking why you would buy a property with your Ex wife as that is a seperate consideration.
If you buy the property as Tenants in Common with the share split as you indicated above you will not be able to claim a Tax deduction as she will be occupying the property.
If this is the main purpose you would be better off to buy the property solely in your name and she rent it off you otherwise it will be treated as her PPOR.
There are other considerations so speak to your mortgage broker first before rushing in.
Richard Taylor | Australia's leading private lender
Freelance
The property would need to be considered your principal place of residence so you have to have the services etc in your name.
You need to occupy the property for a period of 6 months in the first 12 months after settlement.
Each State will also have FTB Stamp duty concessions which may need thinking about in order to satisfy separately.I would rush in and set up a Trust structure with a Corporate Trustee as the set up costs and higher loan costs i.e interest rats and application / legal fees ec may diminiish the so called benefit.
There are many ways to legally reduce your Tax liability but everything comes at a cost.
Any Building Write Off claimed against the property wil reduce the Cost base when the property is sold so you cant have it in one hand and eat it in the other.Richard Taylor | Australia's leading private lender
