Hi guys, I am about to embark on the whirlwind of property investing, and need a sounding board. I have $100,000 in cash available, and am now trying to decide how to start.
The property I am interested in is $145000 and would rent for about $200 per week, it only needs a quick spruce up.
Do I put in a small amount and borrow the rest at interest only, or put in a larger amount and borrow a lesser amount so my equity is higher?[blush2] This is so confusing!!
There are a couple of other properties that I would like to buy as well, but the hardest step is always the first one.
I also have a current mortgage with my partner with an equity of $160,000, but was reluctant to use that to start out.
Can anyone point me in the right direction?
Hi mhugo,
If your intend to acquire several investments then I would suggest current funds be used as multiple deposits for finance and keep all loans separate to avoid cross colaterisation of the portfolio.Regards
Steven
Mortgage Broker[email protected]
http://www.mobilemortgagemarket.com.au
Ph:0402483216
Ph:1800 820 500
VICTORIAPLEASE note comments made should not be taken as specific taxation, financial, legal or investment advice.
For the interested property use $29k for non loan purchase and borrow 80% of 145k thereby avoiding mortgage insurance, set aside 10k for purchase costs – stamp duty & conveyancing fees etc. That’s a total of $39k leaving $61k for the next IP.
This is a more conservative approach but places you in a less vulnerable position if interest rate rise. It has the advantage of already setting up a base of equity in the property for future strategies such as a cross collateral line of credit. The system does not suit everybody but helps me sleep at night! It certainly is not a get rich quick system in IP. Just more sustainable I believe.Improve your nordic skiing – become an accredited instructor with http://www.apsi.net.au/nordic
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