Simon has some good advice above.

It depends on how far your plan to go. If just one property, then probably your own names, but if many more, than talk to your accountant about structures. But also talk to your mortgage broker too in conjunction as some structures will hurt your serviceability. eg getting one property in three names will mean, when going for hte next loan, you will be assessed on the whole debt (not just your share) but only 1/3 (your share) of the rent will be included.

Terryw
Discover Home Loans
Mortgage Broker
[email protected]

checkout http://www.lawcentral.com.au for agreements.

Terryw
Discover Home Loans
Mortgage Broker
[email protected]

You should be able to purchase a lease cheaply, $25 or so.

Terryw
Discover Home Loans
Mortgage Broker
[email protected]

Steer clear of American stuff on investing , it almost always has no value and will just confuse you with all the hype.

Terryw
Discover Home Loans
Mortgage Broker
[email protected]

They can also be obtained for free by faxing baycorp with your details and signature. Takes about 2 weeks to get it via post.
I suggest you get your clients to get their own and provide you a copy.

If you want to check rental history, you will have to ring all their previous managing agents. Be wary if they say there was no agent and they were renting from Mr X – who will probably turn out to be a friend of theirs.

Terryw
Discover Home Loans
Mortgage Broker
[email protected]

I have some property in Japan, and am interested in China too. My friend has pruchased there and has made huge gains and positive cashflow.

Terryw
Discover Home Loans
Mortgage Broker
[email protected]

Hi

So you basically need more 100%+ finance? What happens if the developer can’t settle?

Your best bet is probably to just delay settlement. You have about 3 weeks from when you need to settle until, the developer needs to settle. If you don’t settle on the required date, the vendor usually gives you a few days, then they issue you with a notice to complete. You then have 14 days in which you must settle. So if you can drag out the vendor initially, you may be able to stetch it all the way to when you settle with the developer. But if the developer does the same thing to you, you may be stuffed.

What about offering $$$ to the vendor to settle later, and/or the developer to settle early?

I have access to private lenders, but they are reluctant to lend for land at high LVRs, and you would be looking at 6-10% per month interest.

Terryw
Discover Home Loans
Mortgage Broker
[email protected]

Hi

Yes it is confusing trying to decide what to do. Steven makes a good point that if you hang on to your IPs you can use the extra income to help pay off your home loan. But you will also lose some in tax.

If you sell, you may pay thousands in CGT. This could be minimised by selling one per financial year.

But, if you sell a property, you will have to buy a new property to replace it, so that may be another $20,000 in stamp duty and costs. And then there is the agent’s fees on the sale, and other selling costs.

Another option is to form a trust, and sell to your trust. or maybe your wife. She could buy your property or your share, borrow to do so, and you put the proceeds of your sale into your home loan. This will still result in all the above costs, but you can save on agent’s fees and still ‘keep’ the property. ie you will know that you are buying a good property.

If they are performing well, it may be better to keep, or to sell to your trust.

Terryw
Discover Home Loans
Mortgage Broker
[email protected]

I agree with Simon, it may be possible to borrow, but it appears you may be overstretching yourself.

To borrow against a farm using a no doc loan would mean high interest rates and very low LVR. So this will eat into your return as well.

Terryw
Discover Home Loans
Mortgage Broker
[email protected]

There are only two LMI companies which makes it hard. Both have certain requirements for maximum exposure levels per client, meaning they will only approve lends up to a certain total amount per borrower. This does not matter which bank you go with, all adds to the total. Offhand, I don’t know what the limits are for full docs, but for low docs they are $800,000 for PMI and $750,000 for GE. So this will limit the number of loans you can get that are mortgage insured. And watch out, most of the small lenders have all of their loans mortgage insured no matter what the LVR (Macquarie, RAMs etc).

You may be better off just refinancing a few properties at a time. If they are cross securitised, you can apply for a release of security with the current lender, and then refinance that property with another lender. The remaining security will have to be valued enough to support the remaining loans with the origianl bank.

It shouldn’t be a problem refinancing IO loans, maybe you meant they were fixed? If so, you could have large exit fees, and it maybe better to wait.

Terryw
Discover Home Loans
Mortgage Broker
[email protected]