I currently have 4 Ip’s, value just over $1,000,000-, my debt is just over $300,000-, so as you can see I have $700k in equity,
I have just applied to the bank for $200k, to purchase no. 5 IP, however the bank has declined this, reason being we could not afford to service the loan!
The exsisting properties bring in $33k a year, which covers exsisting loans, My income is $40k a year, and I am currently renting a cheap house to live in,
the bank advises I am relying to heavily on rental income to be able to repay the loans, even though the new $200k home would bring in $400 week rent.
Can any one help me with this?, I know the property is positively geared, and wish to buy many more using this same method, but when your assett rich and income poor, how do you get the money?First of all, find yourself s decent mortgage
broker, there are some hanging around the
forum.They should be able to advise you which lenders
and products will suit your situation.Don’t forget to ask them to rebate you some of
the commission. There’s plenty of brokers
around so if one won’t another will.With your equity/income situation they aren’t
working too hard.andy
Yes that happens. The old too rent reliant trick!
With that sort of equity, even if you don’t serivce.I haven’t check your serviceability, but even as a last resort you could (probably-depending on the areas) get a No Doc loan to 65% of you current IPs and pay cash for the new one without mortgaging it!
ps I don’t rebate any of my commission.
Terryw
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Hi catichau
You could also take a look at http://www.navra.com.au
They use a strategy called the cashbond which is specifically for people in your situation.
I personally haven’t been in that situation, but the weekend course (very cheap at a couple of hundred dollars) was really interesting and I learnt a lot of stuff.Keep smiling
Felicity
Hi Catichau, as you can see, the general consensus is to get yourself a good mortgage broker. Find one you feel comfortable with as a good broker will prove invaluable now and in the future.
All the best
Marty
Hi Catichau,
Sounds like you’ve certainly got the property selection side of things worked out well!! Agree with everyone above re broker help required & like Terry as a broker I don’t hand back commission either, old saying – pay peanuts get monkeys!! Instead I try to add value in other ways by teaming my clients up with excellent lawyers, accountants and financial planners who can ensure all their bases are covered.
There are definitely some lenders out there, eg Macquarie, who’ll look quite favourably over this deal.
If you are Bris based I may be able to help, and learn where you’re getting all these great deals!!
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Mel
[email protected]Hi catichau
Give this guy an email and see if he can put you on to a mortgage broker over your way.
Take care
Dave [][]Hi Catichau
Yours is a common problem. Guess thats why the Bank’s created the Limit Doc loan. Stated in the UK in the mid 80’s it is aimed at client’s similar to yourself. Most of the banks we deal with charge the same rate of interest as they would do if you could prove your income. Happy to have a look for you if you want to provide me with some additional information.
Cheers Richard
[email protected]There is no such thing as a problem. Just a solution waiting to be found
Richard Taylor | Australia's leading private lender
thanks all of you, for that information, I never even thought of a broker, I guess I felt loyalty to my bank I have been with for years! I will sus out some further avenues, keeping in mind risk however, is there a reason banks dont lend, but others will?
thanks again catichau
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