Hello Everyone,
I’ve been asked by my cousin to find out the steps she would need to take to buy two properties, one as a PPOR, and one as an IP.
She has no savings, but has a good income.
This is what she does have.
Her mother owns her house outright which is valued at around $400K. Her mother is elderly and has placed my cousin’s name on the deeds of the property, but wants her to be able to use this property to get one of her own, along with an investment property. She is also able to claim the FHOG.
My cousin has been paying rent for the last 6 years of $220.00, so although she has no savings she is able to prove that she is able to repay a loan. What she wants to know is how she starts, and what is the best way to protect her mothers property?Cheers
LeighDoes your cousin live in the mothers property? If so she may not be entitled to the FHOG.
When was she put on title? This may also affect her FHOG entitlement.
Rent payment is not savings. Banks that need 5% genuine savings will not consider rent.
She may be able to lend against the mother’s property – in this case she will not need to show genuine savings.
She needs to find a reliable broker to go through all of this with her – I feel there might be a need for some education before she jumps into anything too quickly. Now that the market appears to be settling a little there isn’t so much urgency anymore and she can take the time to learn the ropes.
Cheers,
Simon Macks
Mortgage Broker
[email protected]
0425 228 985Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.
Hey Mortgage Hunter,
No she does not live in the property, she rents a property a few doors down, and her name was added to the deeds around 2 years ago.Cheers
LeighShe should be OK for the FHOG then. The issue is if she is on title and lived in the home then it would be her home. At this point she should be able to call it an investment property.
Be aware that the ownership of an investment property prior to 1 July 2000 will also remove a FHOG entitlement so this is an inportant date for her.
Cheers,
Simon Macks
Mortgage Broker
[email protected]
0425 228 985Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.
Hi double2,[
]It is possible for her to buy other properties using the equity in her mothers home.In order to simplify matters the new properties would have to be in joint names.The share of ownership on the title can be adjusted in order to suit the person who is able to provide the nessesary income needed to service the loans.
This way the mother provides the equity needed for the purchase, whilst the daughter provides the loan repayments.Regards
Bryce Inglis
[email protected]
http://www.ipal.com.auHi double2 your cousin should aply for a an improvement loan on her mothers property and use this to buy a property outright then she has a property with 100% equity.From there the sky is the limit
Mortgage Hunter
I have question.
I am currently looking at purchasing a investment property and this will be the first property I have ever purchased. I understand as the property is for investment I am unable to claim the FHOG.
However in 3-5 years when I purchase my first property to live in am I still entitled to receive the FHOG.Thanks
Matthew
]
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