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Adding to the other 2 comments.
9 isn't out of the question although Alistair mentioned you might end up paying a higher rate initially without pre-sales.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Wow going to be bullish here but i have to disagree with the others.
I would suggest you would be considered PAYG employed but we would still need to provide copies of the Company's last 2 Tax Returns.
Done one very similar to your position for a forum client in Dubai only recently and didnt have an issue there.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Couldn't agree more.
Can't go far wrong and a great bloke to boot.
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Yours in Finance
Richard Taylor | Australia's leading private lender
I think Jamie has already answered this you need an equity loan over a LOC.
A Banker will give you 101 reasons why you should cross collateralize the securities and how it is good for you (or if not you for the Bank) and then if that doesn't work will tell you to use a redraw as there is no real issue and the ATO will never know if you claim a deduction.
Professional unbiased advice is the only way to go.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Maybe double digits is a slight exaggeration
Brisbane's average residential rates bill will rise 3.8 per cent under Brisbane City Council's 2013-14 budget, lifting it by 88 cents a week or $45.60 a year.
The increase is lower than last year's 4.5 per cent rise but above Brisbane's consumer price index, measured at 2.1 per cent in the March 2013 quarter.
In saying this it never amazes me to see certain well know Buyers Agents putting clients into Cairns where the Council Rates take up 20%.
We place a lot of clients into residential investment properties thru our Buyers Agency arm and are very particular about the sort of property we put clients into.
High Body Corporate fees or excessive Council Rates need to factored in.
Course for some agents / investment advisers that is the last thing they look at as the investment doesn't look so attractive on paper if they mention that.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Hi Jamie
Yes i still own multiple properties in the area in my SMSF but of course purchased when prices were considerably cheaper than they are now.
In regards to your saving for a deposit there are a few 100% finance IP schemes around (without having to use existing equity) which we have access to so would depend on other details as to whether you could go for a higher purchase price.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Quite well is a slight understatement.
Bought one house in my SMSF for 32K which i then onsold thru a Rent to Buy scheme to the existing Tenants.
They pay just over $22K per annum and have been there for a further 10 years. They still owe my SMSF $76K plus a balloon at the end.
Not a bad cash on cash return.
As for buying in know at todays prices i wouldn't touch it as the clientelle of the area has changed dramatically.
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Yours in Finance
Richard Taylor | Australia's leading private lender
If not mate get your Broker to refinance the loan for you and structure it correctly from day 1.
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Yours in Finance
Richard Taylor | Australia's leading private lender
That's why i don't use PM's i employ my own member of staff too manage my portfolio.
She covers everything from regular property inspections, interviewing new tenants as well as providing me with a portfolio statement any day i ask for it.
In saying that i understand not everyone can afford or justify to employ their own PM.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Yes your own serviceability will be taken into consideration on any new borrowing.
Make sure your Broker gets a couple of LMI quotes for you as the even though their are 2 main mortgage insurers the rates charged varies from lender to lender.
Building a property portfolio is more about the structure and set up rather than the bottom line interest rate.
This is the mistake many new investors make and they end up paying for it later.
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Yours in Finance
Richard Taylor | Australia's leading private lender
A5 that of course is properietary information and why we spend thousand of dollars on visiting towns and carrying out own research which we offer to our clients.
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Richard Taylor | Australia's leading private lender
Unlimited, it will depend on with whom your loan is with as to whether you can create a second split.
Either way i would have used an equity loan rather than a LOC.
Link your offset account to the non deductible split.
If unsure get your Broker to do it for you. We do it all day long for our clients.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Hi Steve
Firstly welcome to the forum and I hope you enjoy your time with us.
Being a pom i wont hold being Irish against you especially as we have to stick together as Lions for the next 3 weeks.
Sorry to hear about the downturn in the Irish market. i have a property still in the UK and must say the South of England (ignoring London) has held up extremely well over the last 10 years although i did buy it some years prior to that.
Couldn't agree more with you about spruikers they are everywhere and more than happy to take your money off you when they haven't achieved anything themselves.
When i first correspond with a client on either the mortgage broking or buyers agency side of our business I always say to them make sure you deal with people who have achieved financial success or on the way and are not in it purely for the remuneration it brings.
In regards to your Irish property it seems like a big loss to take in selling it however it also looks like a drain on your monthly finances and not sure how much of that you claim back in Eire.
Do you think you would ever return to the property if so would probably think about hanging onto it.
Not sure what the loan balance is but selling might mean having to put in cash in to pay the loan down and that might not be available or ideal.
Anyway more than happy to have a chat with you if you ever want to ask 101 questions.
I have been doing the odd investment seminar over the last few months in both Sydney / Melbourne so we can always catch up for a coffee next time i am down.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Unlimited, just to clarify that the 150K LOC is a totally separate facility and not part of a redraw or mixed with your personal borrowings ?
Assuming this is the case then sure draw 20% + acqusition costs from the investment line of credit (personally i prefer equity loans as they are charged at cheaper interest rates) and then take out a standalone interest only loan with a separate institution. There are some excellent investment products doing the rounds at the moment without annual fees etc depending on the loan amount and lvr.
In regards to how you claim the interest on the 150K LOC if you operate interest banking thru your lender you should be able to print off a statement covering the interest charged for the year and you merely add it to the interest charged on the interest only standalone facility on the new IP.
Of course before you proceed make sure you don't intend to buy another IP and end up using all of your LOC up as it is certainly easier to go to a higher lvr with a purchase rather than try and draw out equity at a later date.
Also as mentioned make sure your new LOC is totally separate to your current PPOR borrowings or you will end up contaminating the entire intere
Finally make sure you do not listen to your Bank / Banker if they tell you anything to the contrary.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Yes so true Freckle if only it was as easy as all that.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Hi A5
I think you have the right idea.
Thru the Buyers Agency arm i run with my business partner we look at a couple of other important drivers in relation to property proximity, university / hospital location in the town etc.
Of course you want to try and buy in an area that will grow but yield and cash flow is more important as it the lifeline to increasing borrowing and moving ahead.
Lenders don't lend against capital growth but the do lend against increased rental income.
If you are prepared to look slightly further afield than NSW i think you will do very well.
Maybe slightly biased but my gauge of dealing with a Buyers Agent or investment adviser is have they achieved what you wish to achieve or are they in merely for the remuneration.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Hi Menia
I think you have your head screwed on and totally agree with you that you can live off rental income but cannot live off capital growth.
We specialize through our Buyers Agency arm in locating properties just as you have outlined and find it is important to match the property with the clients goals and objectives.
Too often i see clients being into properties that simply will not do what they wanted them to do.
Careful property selection in areas that have the right drivers is paramount to building up a decent portfolio.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Yes Spiro
I agree with makes me laugh but i must admit the majors do a good job of focusing on bottom line rate and not much else.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Oh Joe often comes with the territory.
My usual response is cya later.
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Yours in Finance
Richard Taylor | Australia's leading private lender
Rick
Most of don't charge a fee as we are remunerated by the lenders with whom we deal with so cost you nothing for our service.
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Yours in Finance
Richard Taylor | Australia's leading private lender
