Hi All,

Just a word on mortgage brokers…

Before I ever logged on to PI.com I was taken for a ride big time by a broker. Initally he had several lenders that I could go with. I just had to pay $750 (or thereabouts – it was a while ago now) and he’d get things happening for us. He then led me up and down the garden path for about six weeks before telling me that we couldn’t get finance and we couldn’t get a refund. At that point I decided mortgage brokers belonged in the same basket as used car salesmen (sorry if any are reading but the cliche gets the point accross).

After a spending a while here and getting to know a few brokers I can say that I have changed my mind. I now know some mortgage brokers that I hold in very high regard.

I think it is like most professions where only about 5% of people truly excell at what they do while the rest range from being honest and capable through to having no idea or being outright scam artists.

It’s all learning and I certainly won’t be taken for that sort of ride again

Regards,
Sonja

Beware if you don’t have a will and just assume that your estate will go to the next of kin. The person or persons who you define as next of kin may not be who the legal system names as next of kin. I am personally involved in a case where the status of “next of kin” is being contested via legal proceedings. Whoever wins the title of “next of kin” will then be the 100% benificiary of the estate as there was no will.

Having known the deceased for about 10 years I can pretty safely say that neither of the two people contesting for next of kin status are the people he would have chosen to inherit his estate. I believe he would have chosen to put the money into a trust for his two boys (aged 5 and 2). Too bad that his parents and ex-defacto (neither of whom have responsibility for the children) both think they are entitled to it…

The outcome is yet to be decided and may take up to a year.

Don’t think it can’t happen to you. If you care who benifits from your wealth then have a legal will. At least then you have a fighting chance that your estate will be distributed according to your wishes.

Regards,
Sonja

Hi Kerri,

There is a fairly low limit imposed on additional income (not sure exactly how much) before they start to decrease your pension. This is not the problem because the amount of pension you loose is less than the amount of additional income you earn ie you have more $$$ p/w anyway. The problem as I understand it is that there is a limit on the value of your assets (in NSW I think it is about 300k and your PPOR is not included in this regardless of the value) so unless that 300k worth of property is safely +ve CF then you will likely end up with less $$$ p/w.

I am no expert and this is only my understanding of it. I am a bit frightened of Centrelink as I once rang them 4 times about something important (to us) and recieved 4 different answers. Perhaps there are private accountants with comprehensive knowledge of Centrelink policy.

Best of luck to you and your mum – I’m sure there is a way to get free of that pension.

Regards,
Sonja

There are times I have put my card in cedit for various reasons (never more than a few thousand though) and the points were awarded when purchases were made. I can’t see why this wouldn’t work on a larger scale if you have access to that amount of money. If you are borrowing to buy the house I’m not so sure that the financier would want to deposit the funds into your credit card.

Regards,
Sonja

Hi rogrecog,

My thoughts are that you have done a lot of reading and thinking before making those 2 posts

Not sure how long it took me to realise for myself but I came to the same conclusion as you. There are countless ways to make money from real estate but just a few general rules that successful investors seem to follow. Some of these rules seem to be quite general (eg try not to let emotion interfere with your investing decisions) while others are more individual (eg Steve’s rule that the investment must make money from day one).

At the moment I consider myself as just beginning to put theory into practice. I have just enough practical experience to realise that the vast majority of my learning as an investor is going to come from practice rather than theory.

I don’t underestimate the value of theory and due dilligence though, as I have been saved from some huge mistakes (and will probably avoid many more in the future) thanks to the books, seminars and forums.

Regards
Sonja

Hi Kate,

I think you sound very brave. Although you are scared you sound as if you have already made the decision to change your live for the better. Don’t loose your focus – I believe that you already have a plan (you have repeated it several times on this thread) and you know your situation better than anyone else. Do your due dilligence (asking questions here is part of that), have faith in yourself and follow your chosen course of action.

Some sacrifices are hard to make (eg selling your PPOR) but in the long run are worth it. When I am tempted to feel regret or loss over material things that I have had to sacrifice I tell myself it will only be a matter of time until I can have something even bigger and better with less hassle and stress. We are concentrating on actively building wealth now and accumulating “nice” things when we can do so without sacrificing our future (never easy but sometimes harder than others). On the other hand those precious moments with my children can never be replaced. I believe that my kids are better off with me at home most of the time and that they will be better off in the future as a result of our property investing efforts (despite the sacrifices we all feel at the moment).

As for those who knock you and/or your unconventional ideas… Do you want to achieve what they have achieved? Or do you want something more? It seems to be a common thing that friends and relos all jump on the bandwagon to call you “mad” (or worse) when you start talking about doing things differently from them. Just remember that you have to do things differently to end up somewhere different. Stick to your guns and good luck with it.

Kind Regards
Sonja

And here’s me thinking that we were special because NAB now acknowledges that we have a “relationship” with them. We get a “relationship benifit” that seems to cover all of our transaction fees. Not quite a hamper with a hand written note though…

You must be very special Greg! Congratulations:)

Regards
Sonja

Why limit yourself to banks when there are so many other finance providers? BTW which one treated you well IQ? It sounds like a novel experience to me. If you can’t tell… I am very unhappy with my bank right now. This is the 3rd and last bank I will deal with directly – IMO you can’t do better than a top class mortgage broker.

Kind Regards
Sonja

Hi KP1,

I’m sure there would be a low/no docs loan that you could use. Some of the mortgage brokers here will be able to give you more details. With 450k equity you should be able to do well. Good luck with it.

Regards
Sonja

Hi Shackles Off,

I feel this is really a question that only you can answer… Just how nice is it to have that property? (vs how nice are the possible alternatives?).

If you decide to sell it though, I think it would be worth waiting for another couple of months as you will then qualify for 50% profit CGT free. You must hold the property for 12 months from signing the purchase contract to signing the contract to sell (I think). That is my understanding of the situation although I’m far from being a qualified accountant.

Regards
Sonja