Forum Replies Created
Hi,
Few quick points:
– Going low doc doesn't make it easier to build down the track. Just go through a bank and get a standard loan to purchase the land. You'll get 80% lend on this easy without LMI. Down the track if your bank/broker is worth their salt, you'll just get another loan for the construction costs. Going low doc will just mean higher interest payments and more capital input at the start, but less work for your broker …
– It doesn't sound like you're struggling with your business so I doubt you'll have issues getting the loan. Most bankers understand that the income used to assess servicing is your wages + net profit in the business. If your broker/banker doesn't, i'd suggest talking to a business banker or a broker who deals with businesses.
– Usually as long as you can explain what the credit enquiries are for (yours sounds like a reasonable explanation), the bank will be ok with it. Sounds like your broker isn't doing what you pay him to do …
– On a side note, how would you have 10 enquiries on your record for one refinance? If the valuation came in $300k lower then no-one would do the refinance, so why apply another 9 times?Hey,
It really depends on the lender. The bank is asking you what you're going to do with the money as they don't want you investing it in something really risky. To give an example, you might be using that money as your equity in a highly speculative industrial subdivision project. If that project went sour, you could easily owe the bank more than however much you thought that industrial land was worth.
Sounds like what you're doing is no big deal – I'd just show them the purchase contract if you have it, or tell them exactly what sort of property you're looking at purchasing. They'll probably be ok with this.
On the flip side, you sometimes get a dodgy bank manager who won't find out your full story and that's why sometimes people get away without telling their bank what the cash is for.
I think Robert Kiyosaki offers wannabe motivational speakers the boost of his brand name in return for profits. I believe Dolf de Roos then realised he had built up his own name enough through the rich dad series, & so severed the ties. This would explain why he’s doing something with Trump.
I was just browsing around there and it’s got an ok summary of the process there.
and regards to the market price for a property, agents use http://www.realtor.com.au to make a CMA (Comparative Market Analysis). Im not sure how you pay the subscription fee from what I saw browsing the site, but I know numerous professional investors use it.
Oh and by the way Monopoly – my mentors arn’t in the same boat – most of them are very rich. I was saying I have few friends who have similar goals as well, who i’ll probably work with to go where I want to go.
Thanks for the constructive criticism people – it’s well met [biggrin]. Has anyone else got their opinion or ideas to add. I’d appreciate all the input I can get. Thanks yall
Sorry to the pessimest J.T Reed, but after reading all of his Dolf De Roos article, I can’t help but laugh.
Firstly, I love how he says “there isn’t much money in property management” – small time there’s about a job + a business profit, but there are big companies doing it creatively that are making truckloads.
Secondly about how hard he rekons it is to find +ive cashflow deals. I was recently working in a real estate office and came across numerous +ive cashflow deals on our books.
My major concern though is with the people who read what he says and say to themselves “he’s right – it’s really hard work”. That just puts people off and makes them look for reasons why it can’t work, instead of how it can. My opinion is it’s not important what facts and all Dolf & Robert say, it’s what you get out of them and whether it empowers or disempowers you.
You may want to read the book “Building Wealth” by Russ Whitney – he talks in there in a fair bit of detail if I remember about how you can make quite a fair bit of money out of renovating. It’s a US law-based book, so I dunno bout some of the specific legalities.
But anyway, one of the things he talks about in the book is how where he is, you can be a contractor for your own properties without a licence. So what you can do is “hire” yourself to do some contracting work to fix up your property, then quote the cost to the bank with a few hundred % markup, borrow out this “cost” from the bank and use the excess cash to invest in more properties.
Sorry if i’m hard to understand atm, i’m pretty tired [sleepyanim]
I was working in a real estate agency recently and I can say that basically most sellers have got way too big expectations, compared to buyers, and the market is slowing.
A lot of properties are stagnant atm and they’re not moving very much. But mind you, working in RE for a bit teaches u a lot about the difference between good and bad agents!
Anyways, the general consensus I was getting from agents was that sure there are seasonal differences in how fast the stock moves, but when it gets to warmer months I can’t see the properties selling much faster. There’s too many grossly unrealistic sellers atm.
It probably should, but i’m sure if the banks there are willing to allow you to lock in your interest rate for 30 years, they’ve figured out the consequences of it. I don’t think it’ll affect the rates the banks charge
I agree with Monopoly. You can’t just use the yield. I know of a few units that have quite an alrite yield that would be +ive geared that way, but they can have some $4.5k body corp that means you’re actually dipping into ur pocket to keep it.
You have to do a full analysis of all the costs really to make an informed decision
Tip: Wise men never spit into the wind.
Next 2 years – Work & learn the real estate industry & selling
The 4 years after that – buy & add value to property to retire at the end of this period
The 5 years after that – Invest big time to create my real retirement income (100’s thousands/yr)
After that – See the world & do motivational speakingOh yeah, and i’m 19 so that means i’ll be there by 30
Buy the pack of Cashflow101 + Cashflow for kids for $340 i think it was, then sell cashflow for kids for $100. That’s what I did
Some advice I once got is that 95% of people do the same thing, so if you want to succeed, you just have to be the 5% that do the opposite.
I’d say that a lot of investors dismiss small towns from the start because in their belief systems, small towns are risky. Saying that, you really should take a good look at all the aspects of your prospective properties/towns.
If it’s not too far and you’re taking a serious interest in the town, why not go take a day trip there and chat with the locals about the area. They could probably give you more info than most investors can get via statistics.
One thing I rekon you could do maybe in the future is make a computer program to invest in property. That way you wouldn’t be limited to your own time to analyse deals & do the work.
It could tap into numerous abs & other data on the internet to identify the most likely growth areas, while also accessing numerous real estate data to put together possible deals. Using this sorta program, you could simplify the process so much that you could employ secretaries or whatever to do the necessary phone calls & all, while you just sit back and watch the money pile grow
.I still don’t see how you equate giving easter eggs to one of your tenants with tenant loyalty. I think if a tenant was thinking of moving out, they wouldn’t say “but my current landlord gives me an easter egg at easter, so I think i’ll stay here just for him”.
I think you should use these sort of gestures when you can see they will have a real benefit for you as well for the tenant/property manager. I like the one about the $40 credit at the local nursery someone said.
Giving is nice, but giving and receiving is always better
I have a friend who went to one of Robert Kiyosaki’s 3-day seminars that cost around 6k or so. When he came back he told me that a lot of the stuff they learnt was just what was in his books – which cost around $25 each [glum2]
Mind you though, he went on to start a business which is doing extreemly well atm. Maybe it’s like a placebo – some people need to spend stupid amounts of money for a seminar in order to feel the information they’re receiving is worth it?
I think if you happen to get any more gut feelings as to where to invest – you should go for it. One property at least usually won’t hurt that much – depending on your financial situation of course. At least once you’ve bought a property and experienced all the emotional distress and yadayada, you’ll be more inclined to trust your logic the next time.
Even if you do have other investment properties, you’re treating the situation like beginners do, so i’d suggest you treat it the same way. As nike says,
JUST DO IT
Why not research the going rents in a certain area that has good yields, then make offers according to what you would like your purchase price to be – no harm in trying that
.
