Yes red. That is the best way to set up an offset. Why would you attach one to a P&I loan?

If you are looking at spending issues when comparing LOC and Offset Accounts, you are looking at the wrong thing. You can get into trouble with either one just as easy.

You must look at the benefits of one over the other… such things as tax benefits when comverting a PPOR to an IP, ongoing cost of the loan, interest rates, flexibility, etc.

A true LOC does last for life but the average loan life these days is less than 4 years. I would not even look at loan term!

TMA

The problem with margin loans is that when applying for a home loan, they usually look at the limit even if you are nowhere near it. If you are not using it all and have no intetntion of doing so in the near future, it might be wise to reduce the limit if serviceability is an issue.

Regarding the income on the shares, these will only be considered if you have been receiving them for a decent period and declared the income in your tax returns. Low doc is always an option though.

TMA

Prices have dropped plenty already. I can’t see much impact of the loss of $5,000.

In any case, the FHOG is not geared at any LVR. First Home Buyers cane borrow at 100% LVR or more. It all comes down to serviceability.

TMA

Lots of lenders in NZ will do this. You can access them from Australia if you like but it would be easier to deal with a NZ lender as they are specialists in their own rules.

TMA

The ONLY way you could borrow the whole lot is with a whole lot of additional equity you already own and a whole lot of stable income!!!

Alternatively, get a partner with money!

TMA

I agree about the sticky note. It is a question to ask management and mods though. I have asked in the past for similare stickies only to be refused.

TMA

It is becoming more common. I would prefer lending to someone with a history at such high LVRs than someone without any history such as a first time purchaser.

TMA

Give it a rest ‘Programmer’!

The informatiion you didn’t want but ‘supported’ IS available. I certainly hope you do a better job of ‘Programming’ (assuming again) for your clients seeing you are not capable of doing a simple search in a forum!

TMA

An Agent is not qualified to provide a valuation on your property. There is an old trick that Agents use called ‘crunching’ (or ‘conditioning the vendor’). This is most common during auction campaigns but is equally as effective through standard for sale campaigns.

What happens is the Agent will tell the vendor the price they want to hear (ie: a ridiculously high price). They call this a ‘FREE Market Appraisal’. It is basically sucker marketing vendors to get them to sign up.

Once the vendor signs, the Agent usually has an exclusive agreement for 3 months or more. They have you by the short and curleys!

As the campaign moves forward, the Agent will come back with offers below what they told you. They begin to point out the negatives of the property and the toughness of the market to ‘condition’ the vendor. Coming into week 3 or 4 and with such ongoing ‘conditioning’, the vendor is usually ready to take less than what they were told by the unqualified Agent providing the ‘FREE Market Appraisal’. The sale usually occurs at this lower price.

Although the Agent is not always successful using this tactic, it is successful more often than not. Real Estate is a numbers game. The more you ‘list’, the more you can sell after talking the price up to get the vendor to sign and then ‘conditioning’ to bring the price back down to realistic levels.

PS: The Jenman system is the worst system I have ever seen for ‘conditioning’. Apart from what Jenman Agents may tell you, no person in their right mind talks a price up. Everyone wants to offer less than asking price. Auctions have their place in strong markets when competition drives the price up!

TMA

Programmer, it has been done to death over and over again. Just search for LOC or Line Of Credit and you will have numerous scenarios. You will also find many of your FAQs answered in the many posts. If you cannot find a clear and well-constructed post in this forum, it is only because you have not looked.

In any case, who will pay for a full explanation of all aspects of the Line Of Credit comparison with standard loans including various outlined scenarios???? I have been writing such a document and am up to more than 15 pages and still am not satisfied that it is complete. This does not include the various pages of diagrams!!!

Ask the forum owners or moderators to provide the information you seek as none of the posters have access to making the posts into a ‘sticky’ so you would not have to search for it.

TMA