Forum Replies Created
Hi George
I think you mean you will be buying the property as a PPOR rather than an IP and claiming the FHOG and stamp duty concessions.
As has been pointed do not pay lump sums into your loan and then redraw it for personal purposes and expect to obtain a interest deduction as the purpose test will not qualify. Also you will be suprised how many clients i have that pay off their PPOR and then decide to rent it out and buy another PPOR and realise that under normal circumstances they are unable to claim the interest as a deduction.
Flexibility is the key word. If you want to reduce your interest burden but like the option of a fixed rate why not have the best of boths world and take an interest only fixed rate loan with a 100% offset account.
Many MB's are just not creative in their thinking and lack experience when it comes to loan structuring so maybe get a second opinion. Ask you broker how many properties he owns and then decide if he talks with experience or not.
Richard Taylor | Australia's leading private lender
Moose
Other way around.
Rams are a securitised lender so therefore ever loan irrespective of the LVR is mortgage insured.
You therefore have 2 levels of underwriting and with LMI tightening up policy across the board I can think of many other lenders I would approach first before i go to RAMS.
Richard Taylor | Australia's leading private lender
Moosehead
You must understand that several of the major lenders are rewarded on a variety of sales targets.
Retention of loan business is just one of the target areas and therefore a cross collateralised loan helps them retain your business due to the complexity of having to untangle the mess.
Most Bank jonies are after every dollar they can get so dont be too hard on them.
In addition, most of them have no knowledge or experience in investor loan structuring so to them it is all just one big loan.
Richard Taylor | Australia's leading private lender
Hi Peter
Good to hear.
What are the early repayment fees for say the first 5 years.
Richard Taylor | Australia's leading private lender
Let
That is not quiet correct.
With 100% finance on an ip you will miss out on FHOG, thats in VIC.
The First Home Owners Grant is a Federal Government innovation which is ran and admistered by the Individual States and Territories.
Purchasing an investment property first will not disqualify your application to qualify for the FHOG in any State.
Certainly Stamp Duty concessions maybe effected.Richard Taylor | Australia's leading private lender
Nothing to stop you selling the existing PPOR into Trust, paying the stamp duty but borrowing 100% of the valuation and then using the funds to purchase your new PPOR.
The total amount of the interest raised is then tax deductible.
Remember to structure your new loan correctly incase a few years down the track you decide to do it again.
Richard Taylor | Australia's leading private lender
Mal
2 quick points:
1) You may find it harder than you think to obtain a loan if you are a recently commenced Contractor especially if LMI is involved.
2) You are able to make application to reduce the tax deducted from your weekly pay if you are employed and in receipt of a Payment Summary. Just lodge a 221d Tax variation and you rwill get the same result.
There maybe other reasons that you would think about becoming a Contractor which i have not raised here but dont jump in.
Richard Taylor | Australia's leading private lender
Adam
Try Steve Hodgkinson who is a partner at the Gold Business Group at Southport.
Steve has been my Accountant as well as a very good mate for the last 12 years and certainly knows his stuff.
He can be contacted on 5532 2855.
Tell him I referred you as most decent Accountants are not taking on new clients and at least you will get past the receptionist with the mention of my name.
Richard Taylor | Australia's leading private lender
Dave
I think you will find it hard to avoid the GST as the rules now are quiet clear and simple.
Richard Taylor | Australia's leading private lender
Might want to do a search on the Investors Club (Club what a lauf).
They are a money making marketing organisation.
Richard Taylor | Australia's leading private lender
Chris
You may also like to refer to my response to your other post.
Certainly not every lender offers 100% offset especially on interest only but there are a few and a good mortgage broker should be ale to identify these for you. In effect if you have a loan of $195K and $15K in your offset then your monthly interest expense will be calculated on $180K.
As and when you withdraw the $15K from the offset the balance will reduce and the amount of interest charged will increase accordingly. The purpose for what you use the offset funds for is neither here nor there.
Remember if you pay down a loan and then redraw back to the original balance for investment purposes you will not be able to claim the interest as a tax deductble expense.
Richard Taylor | Australia's leading private lender
As Simon mentioned if you are referring to a FICO score or similar you are not referring to lending here in Oz but in the US.
Grab a copy of your credit file and see what the lender will see and you can make your own mind up.
Alternatively once you have a copy get your mortgage broker to scour over the credit file and give you an assessment.Richard Taylor | Australia's leading private lender
You bet they suggest you cross collateralise your loans together as once you are deep in with one lender or broker it is very difficult to get out and release securities.
Why would you pay for something the average broker does for nothing especially as half their consultants probably dont have more than a couple of properties in their portfolio.
Hardly speaking from a path of experience.
Richard Taylor | Australia's leading private lender
Try Lewis O'Brien Solicitors in Balwyn.
They have done 1 or two themselves.There website will give you a little more information
http://www.lawyer4nix.com.au/menuvendor.html
Richard Taylor | Australia's leading private lender
Why not structure the interest only loan with a 100% offset account on deposit all of your funds into this account to save you interest.
You can then take your time deciding whether any of the eixtsing properties or infact a new property will be your PPOR.
Swing the offset account over accordingly once you have made this decision.
Richard Taylor | Australia's leading private lender
Hi Draconis
No doesnt work quiet like that.
If you intend to eventually rent the property out you would be better off to take out a 95% LVR from day 1 on an interest only loan and invest your surplus funds in a 100% offset A/c.
When you undertake the renovations dip into the offset account.
Most lenders will then allow you to revalue the security.
Richard Taylor | Australia's leading private lender
Taddy
Check out the Qld OSR site which should make things a lot clearer with rgards to Stamp Duty
http://www.osr.qld.gov.au/index.shtml
I have completed around 6 EFM here in Qld so feel free to ask away on any particular questions you may have.
Richard Taylor | Australia's leading private lender
You cant access the equity unless all of the parties to the Title agree to sign the mortgage documents.
One way would be to all parties apply to separate loans in all names on the property of equal amounts.
Richard Taylor | Australia's leading private lender
Yes they fund through AB and not available to investors.
Richard Taylor | Australia's leading private lender
blueheeler
You are referring to the Shared Equity product issued through Adelaide Bank.
Unfortunately the product is not available for investors at this stage.Richard Taylor | Australia's leading private lender
