Before i start, let me introduce myself as i am new to the site, my name is David and i’m a university student from Sydney. i thought i’d sign up after reading the book and try learn alot more about PI.
I’m still new to all this, so i’ll be doing alot of research before i make any decision, but i thought i’d ask to get some your opinions.I currently have one PI and am actually looking to buy a second, but i’m not too sure if it is possible in my situation.
I’m a student with a weekly income of $150-200. I have some equity built up in my first PI. would it be possible for me to get a loan in my current situation?I’ve been thinking about investing in some regional areas of NSW or even interstate, where the property prices are still relatively low.
any help at all would be greatly appreciated
kind regards, David.
thanks for the quick reply.
I’m currently studying B. E-Business (which i’ve nearly completed) and hopefully get accpeted to do a double degree with B. Property Economics.one other thing do you have any tips for doing online research on property markets/ population growth and any other aspects which may help in determining which areas are good to invest in?
The two key points for new lending is equity and serviceability. If both are OK then a loan is achieveable. If one is poor and the other is strong then it still should be doable. If both are poor then we need to work hard!
All depends on what price range you are aiming for, also on your goal.
Get a broker to run some figures for you and see what he suggests.
Cheers,
Simon Macks
Mortgage Broker
http://www.mortgagehunter.com.au
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.
MortgageHunter: I am still in the very early stages of purchasing another property as i have alot of research to do, but lets just say that looking to purchase a property for under 100k.
what would be considered reasonable equity and also in regards to serviceability, what factors do they consider, besides income, as to whether you’d be able to service the loan.The Advisor: thanks heaps for the sites…
to everyone, sorry if my questions seem stupid or simple as i’m very new to all this and i appreciate your patience.
David,
It just isn’t as easy as this. I would need a lot more info before I could give you any figures or ideas.
Why don’t you give me a call or give Rob the Advisor a call. A few well placed questions should get you headed down the right path.
Cheers and all the best,
Simon Macks
Mortgage Broker
http://www.mortgagehunter.com.au
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.
David,
If you already have one IP, then you probably already know a bit about what you’re doing. If you have an income of 150-200 bucks a week, I presume you are on Austudy or at least on some very minimal part-time work. I presume this doesn’t include your rental income, as that would be going to service your current loan. I am wondering how, unless your current property is positively geared, you are paying off your property? 175 bucks a week is subsistence living, so I presume the loan is paying off itself. I also assume you’re living at home, given that 175 bucks would be eaten up by rent and probably leave you living on 2-minute noodles for the week.
As your original post says you wish to complete a double degree, then it seems like you’ll be at Uni a while longer yet- maybe a few years.
You asked if you could get a loan… you might be able to get one of those student-deferred personal loans from a bank, to be paid off when you graduate. I did when I was at Uni. But your investment situation right *now*, would be marginal, in my opinion. IP’s are expensive, and require extra cash in case anything goes wrong… and things do go wrong. In your financial situation, the property you bought would have to receive a very high rental yield to cover up your current lack of finances.
I doubt you’d be able to get an IP loan, although with the deregulation of the mortgage industry, it may be possible. I think without a greater income, you’d be struggling. You may have to defer your IP plans- realistically- until your financial situation improves, unless oyu want to buy a 25k property… in which case, you’d probably have lots of repairs to do anyway.
I’m not trying to be the killer of dreams here, but unless you provide more details of your situation, it currently looks (to me) like paying back a mortgage would be unserviceable.
kay henry
Kay Henry:
in reply to your post, i’m not on austudy, actually have a small part time job, that 150-200 doesn’t include my rental income as like you said is going directly toward my servicing my current loan.
The repayments on my property are at a minimum of 135 per week, but i repay 155 currently. i’m getting 160 per week rent (which i haven’t increased since buying the property 2-3 years ago). yeh i’m still living at home, so living expenses are minimal as i have it pretty good here.by the looks of things, i may still have 1.5-2 years left of uni before i finish, wish it would hurry up though as i feel as if i’m limited to what i can do in terms of my goals for PI.
does the bank take into account the fact that i do live at home and that my living expenses are very minimal?
the more i think about it, it does seem as though my low income is holding me back. Even though to me it seems possible to service the loan, due to my low living expenses from living at home, the bank might/will see it differently.really appreciate your input kay.
The Advisor:
yeh i think it would be a very good idea to see a broker, and in time i will. I’m just trying to get a few ideas and see if it is possible.Originally posted by The Adviser:Most banks will view you living at home as favourable. They will still allocate a minimum living expense though and your income is below the amount they usually allocate. I think you could do something with cashflow positive properties if you go to one of the lenders who allow 100% of rental income and deductibility on investment properties.
looks as though i might have to look for a new job… or just wait until i finish uni before i pursue further PI’s [mellow]
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