Forum Replies Created
Hi wazzie – and welcome to the forum,
It's not so much a 'delayed settlement' as such, but with your offer you request the settlement period to be put in your contract. THe usual may be 42 or 30 days for example, but you could ask for a 60 day one. Not much use to you if the vendor wants a quicker sale though (unless you are offering a higher price or something else favorable to them) and no good unless you request that as a condition also. Many solicitors will try to convince the vendor it is not a good idea, but you never know unless you ask. You would normally request it as 'early access' If the property is new to the market or the vendor wants a quick sale there is much less chance of success with this of course. If you have a couple of agents who you are comfortable with maybe let them know the gist of what you are after, but again it all depends on how long a period you are talking. A couple of weeks early is a common thing however, and if you are only talking the 4 – 6 weeks this is the usual time for settlement on a property anyway – so you just need the early access condition. Make sure it is 'unconditional ' though BEFORE you spend 1 c on any improvements or rennos.
All the best.Hi Terry,
I did pay $1100 once (few years back now) which was inc of 'unlimited consultations per annum) but only left in place for a year – and being an amp guy not a lot of value for money. He ended up taking some of my advice though and selling some of his share portfolio to pay down some of his non deductible debt……
I'm just about to enter the FP industry myself (almost done the DFS….) and will be interesting to see exactly how things pan out in the 'fees' area. The bank I last worked for I got on ok with the FP's (even though I used to hang heaps of muck on them…..as you do……. ) and I often saw quotes for $3500 up to $7000 (I believe there were some higher too) and cannot imagine there would be many 'average' people that would have that $ laying around – whereas they might have been happy for 'free' or 'discounted' costs when the planner is getting 4 or 5% commission on everything they 'sell'.
While I believe on the surface it seems a lot of money, IF it helps anyone on the road to long term wealth, and assistance meanwhile it is a drop in the ocean – but not sure how many will/would see it like that.
Yet, people are happy to spent triple that on a buyers agent, or thousands per year on 'wealth creation/property secrets' type seminars and do /get nothing…….
My 3c worth is I think it will make the advising/planning market more select & specialized, but appeal to or only be within reach of a much smaller potential client base.
Probably got a bit off track there to your original question however……..As already mentioned, it is ideal to keep separate if you can. That said, for cost saving and convenience IF you can achieve it, it is not the end of the world to cross secure the two properties with the same lender, and have 2 different loans (ie – all the refi & stamp duty costs, legals etc you would have as borrowings on the investment loan) assuming you have no plans in the short/medium term to sell either place, or purchase a third property. If you do…….then don't.
All the best with your plans.I don't think you will find a home loan application form that does not ask that very question…..' Are you a guarantor for or do you act as guarantee for……..etc etc'.
Even if you wanted to lie (that is non disclosure really I guess isn't it) you may get a surprise just how much info some lenders can glean from you credit file….and 'forgetting' to mention a liability does not improve your chances of getting approval.Hi GOldies,
They will nearly always look inside now, so a tidy / fresh clean place has more appeal than a slum. Other things looked for by the valuer are sales activity in the area, environmental impact and issues (noise, power lines or HV cables nearby, outlook, distance from road) land value, and improvements done (such as fencing,shedding, location/side of street/aspect, pergola or patio etc) It all adds up to the final figure.
The days of $50k for paint and carpet are gone, but a cosmetic reno certainly won't do you any harm on the average place that's for sure. What was the main reason you were doing the improvements for? Just a higher val?Cheers
You also need to allow for a bit of natural variation between valuers as well. On a $300k property I would not be surprised to have a 5% variation in the value – especially if comparative sales are few and far between as mentioned already. Bear in mind, if you are borrowing money you are at the 'mercy' of whoever does the val for the particular lender too – and some lenders will just use comparable sales (such as a 'desktop valuation) or rates notice CIV figures for lower LVR borrowings. THe only thing I could suggest, assuming you are refinancing is to give a slightly higher owner estimated market value (without being ridiculous) when the lender asks you what you think your place is worth – works occassionally – but only a few grand here and there. I have an exert I will post this week straight from a valuation that explains how figures are arrived at in the event of 'unique' properties or where there are not many recent sales'.
CHeers
As already mentioned, if you are time poor, and the market is quite 'hot' it can be a good idea. But not one of the ones that carries on about 'project management' and 'finding cashflow + properties' etc etc. Always good to get one that specializes in the area you are looking at buying in too. Some charge a flat fee which is a bit fairer. Again, it depends where you are buying. For example, in parts of Melbourne they wont save you any where near the money that you pay them on the price – just your time & convenience – and what's wrong with that if your circumstance dictate?
Cheers
Hi goldies,
While in NSW that is technically 'legal' it is in extremely poor spirit of salesmanship and ethics. An agent could do this do the other guy when (if) you offer a higher amount still etc etc……. They should present the opffer to the vendor, and if accepted leave it at that – if not, then approach you again. You will notice in places like VIC & TAS you see properties listed as 'under offer'. This means they are negotiating and the offer has either not been formally rejected or accepted, or is being negotiated still, or is 'subject to finance or similar. That's how it should be done, but in NSW if the agent is a player they don't have to abide by this sort of thing.
Doesn't sound like an agent I'd like to be dealing with. How bad do you want it?
All the best!
Yep – read Terry's answer again and you have the 110% correct answer.
CheersHi Simon g.
Yes – that would be a big 'no'. Same as you cannot claim travel (such as air fares) to look at 'potential properties' or even property inspections on places you don't buy.
CheersHI MAtt007,
Bummer eh? Agree with Terry though – the cra is not that bigger deal. If you apply with a lender that does not use genworth (there are plenty of them – St.G, ANZ, NAB (not homeside) plenty of credit unions etc – although I am a tad out of date but others may set the matter straight) All it will show is that an 'enquiry' was done for X amount. Nothing more. Make sure the loan amount is different, and with a different lender and tell them you applied for a loan approval that fell through, but now you have found another property and you A. prefer their rate B. someone recommended them C. You've always loved bank X or D. Another plausible explanation (such as the truth) and you may find it is no issue at all. Just be upfront in disclosing the 'previous preapproval that 'may' show up on y our credit file' and I'm sure you'll be ok. All the best regardless.
Cheers
Hi ss -ss
Welcome to the forum.While it is a tad messy, you could indeed do this. It all comes down to what the funds are used for , rather than what is securing them. So while it would be better to 'split ' the loan first, you still could 'redraw' (which is borrowing form yourself) the 60k plus enough for closing costs (ie stamp duty, solicitor etc etc) and claim the interest only on this amount. If doing it this way, I would suggest use a round figure (ie if you need $71,219 use $$70,000) and you need to work out how much interest you pay on that amount each year – but it would be tax deductible. Challenge is you need to take into account interest rate adjustments during the year in any calculations, which is where it gets a trite messy. Still, there's always more than one way to skin a cat – and 20 minutes with a calculator may be the solution for you each year rather than bank fees, and more loans. Either way, all the best.
Cheers.
Hi gcp,
This is a 'textbook' situation where a line of credit facility ( although usually a bit higher interest) is ideal for. Think of it as 'debt recycling''. ie You redo the loan to include (or keep separately as an I/O loan) the balance owing, and then use the LOC facility for all repairs, rates, loan interest (yes!!!) and other expenses that relate to the IP – inc accounting fees, etc – and use the rental income in your 'bank account' as you please. Once you take care of all your non tax deductible debt, then use it to start paying down your LOC.
All the best!
Hi Spicy,
You have had some good replys, but I am just wondering if you are doing a development of this size with the obvious goal to make money, why would you object to a comparatively trivial $750 -$1200 'early exit fee' for a residential loan (depending on the lender – as long as it is a 'major') Less rates then the commercial deal you cannot get, and a very small price to pay for what you want. Surely? I realize the 2nd tier and 'white label type lenders may charge a few grand, but the banks, or even a credit union charge a fraction of this to exit a variable rate residential home loan in the first 4 years – and it's deductible for investment & income producing purposes….
All the best.Ahh Obiwan
Generally most banks would indeed utilize the purchase price if it was less than 12 months old, unless there had been either significant renovations and improvements done to the property, (without overcapitalizing) or there had been some significant growth in sale prices (not listed for sale prices) in the area for similar properties. This is all the NAB will use with there valuers representatives they employ, and any licensed valuer (as they have suggested) will also be basing their valuation on comparable sales figures (and thus growth or reduction in market value) And as already mentioned, the valuation purpose does make a difference – for example a marriage (divorce)settlement/payout purpose as opposed to an increase in borrowings. All lenders view equity releases as you are doing to have an element of risk, especially if your original LVR of borrowings was in the higher levels. You would find with your bank however that a professional val from one of their approved valuers they will indeed use in lieu of their in house one, or seriously consider in the case of others. Then again, there is a stack of dubious stuff going on at the moment – I recently heard of vals in one state on a luxury 2 br apartment complex with a variation of more than 20% between the bank/bank valuers/ and an 'independent' valuer that had been 'commissioned' by a broker representing a sales company.
I must post some wording that was shown in a valuation that came across my desk the other day just for 'educational purposes' on the forum when I get around to it.
And on another note – good to hear you may have some cap growth after only 6 mths. All the best
Cheers
ottg,
The best answer/s I could suggest are all listed clearly and simply above in bankers reply – but with greater spelling accuracy than I can normally muster up……. He is spot on.
Well if rates from neither lender were to change (and it is likely that the major banks will have the variation in rates for some time to come while they all play tit for tat) the bottom line for you is that on a mortgage of $380k, if you do switch banks, you would save $570 per annum in interest. If it was only going to cost you 5 or 6 hundred $ to change maybe – but for the amount you are talking to do so it would not seem very cost effective to me.
Cheers
Hi Joemon,
As long as you have never lived in a property you have owned before you will still be eligible for the fhog.
The osr website has plenty of info.
To quote…..- I have owned an investment home previously. Can I still be eligible for the grant?
A person is not eligible if they or their spouse (including de facto spouse) has had a relevant interest in any residential property in Australia prior to 1 July 2000, whether they live in it or not.
However, a person may be eligible if they or their spouse (including de facto spouse) has only ever had a relevant interest in any residential property in Australia on or after 1 July 2000 and they have not resided in that property for a continuous period of at least six months.
Cheers
HI,
Someone I know quite well found the main problem when asking them to assist in a buyers agent capacity, was not so much the huge amount they wanted up front – but that they seemed oblivious to what what the customer wanted, and seemed to push for 'project management' and coordinating the proposed renno, as well as the high pressure 'speel' and drawing on the whiteboard while going the big speel/sales lecture (very amwayish he said). …
I'm guessing that they push the development side now because they would be unable to save prospective purchasers even the amount of their fees in the Melbourne market, as it is pretty hot, with a lot of stuff only going to auction, and no interest in offers first.
May be a different story for you though if you are wanting them to use your money to do a project they want.. All the best.Nothing. You cannot claim interest as a deduction for a house you own that you are living in. You will howver be cgt exempt on sale, because it is your own home (principal place of residence) that you are living in.
