Hi all, Merry Christmas. This is my first post.
We have very unusual circumstances. I’m almost finished the 0 to 130 book and plan to also read the other(s). It’s been a real help in understanding techniques and Aussie circumstances. I read Kiyosaki a couple of years back but never got the momentum thing happening.
Our circumstances. We own our home outright (approx value $350k), but have no income at the moment. We have about two month’s savings left while our new business gets going. We expect the new business will start paying us some sort of wage soon, but it’ll be very lean for the next few months.
We haven’t had any income for the last 2 years, living off a small inheritance while we looked at various options for buying or starting a business. Our new business is something my wife and I both enjoy, and after 18 years of marriage, it’s good to find something we can do together.
I’ve considered selling our house and renting while we begin investing in real estate, purely to give us some deposit money on the first few properties. Alternatively we could use the equity in our house. But considering our most recent income history, I doubt we’d get finance either way.
I wonder if you’ve had anyone in similar circumstances and what strategies you might suggest.
Low doc or no doc loans are available to you because you have equity.I would suggest no doc and investing in positive geared properties to increase your income.
You will be restricted to borrowing about 65% of your home value but this should be enough for one or two small positive properties.
It is a very simple process and should help you achieve a lot. You get to keep your home.
I might even consider renting something cheap and renting out your home to bring in even more income and help pay down the loans if you and your wife feel comfortable doing that.
Use a broker so they can source you a cheap deal.
Robert Bou-Hamdan
Mortgage Adviser0414 347 771
[email protected]
http://www.mortgagepackaging.com.auFREE Finance-Related Newsletter – Click Here
Comments made are of a general nature and should not be construed as individual advice.
© 2004 Mortgage Packaging Pty LtdThanks Robert.
What’s low doc and no doc?
Andrew
Sorry mate,
Low doc loans do not require income verification and you can borrow usually up to 80% of property value. Interest rates are sometimes higher. You may or may not have to declare an income amount.
http://www.mortgagepackaging.com.au/index_files/low_document_loan.htm
No doc loans require identification and proof of ownership (rates notice) and you can usually borrow up to 65%. They are often known as an asset lend.
http://www.mortgagepackaging.com.au/index_files/no_document_loan.htm
Robert Bou-Hamdan
Mortgage Adviser0414 347 771
[email protected]
http://www.mortgagepackaging.com.auFREE Finance-Related Newsletter – Click Here
Comments made are of a general nature and should not be construed as individual advice.
© 2004 Mortgage Packaging Pty LtdThanks again.
What sorts of interest rates could be expected?
And do such loans make wraps difficult?Interest rates start from around 6.45% for standard loans, under 6% for introductory rate loans, various rates for fixed loans between 6 and 7% depending on how long and higher from different lenders.
It all comes down to product choice.
You do not submit the loan as a wrap. The loan has nothing to do with the wrap. The interest rate you receive sets the base rate for the wrappee, but that is about it.
Robert Bou-Hamdan
Mortgage Adviser0414 347 771
[email protected]
http://www.mortgagepackaging.com.auFREE Finance-Related Newsletter – Click Here
Comments made are of a general nature and should not be construed as individual advice.
© 2004 Mortgage Packaging Pty LtdSorry Robert, I meant for low-doc and no-doc loans; what sort of rates would you expect for them.
I told you the rates. “Standard” just means NOT a line of credit or non-conforming (for those with adverse credit history) loan.
Robert Bou-Hamdan
Mortgage Adviser0414 347 771
[email protected]
http://www.mortgagepackaging.com.auFREE Finance-Related Newsletter – Click Here
Comments made are of a general nature and should not be construed as individual advice.
© 2004 Mortgage Packaging Pty LtdApologies mate, I was expecting 7 or 8% or some such. Hell, at the figures you quoted they’re not bad! Very encouraging in fact.
Off to bed now…. Many thanks.
No problem.
Goodnight and Merry Christmas.
Robert Bou-Hamdan
Mortgage Adviser0414 347 771
[email protected]
http://www.mortgagepackaging.com.auFREE Finance-Related Newsletter – Click Here
Comments made are of a general nature and should not be construed as individual advice.
© 2004 Mortgage Packaging Pty LtdI recently got a 6.99% rate for no doc loan through RAMS, but my circumstances are a little different from yours, ask your mortgage broker to investigate options for you.
There is a JV wrapper in Newcastle who has an associated financier who does a fully disclosed wrap finance deal, I got to him from this saite omewhere… I forget where now, do a search.
Steve
Steve Kerr
Opportunity knocks softly, listen carefully!
The RAMS 6.99% loan is a LOW DOC, not a NO DOC.
I have to ask, why would you want to fully disclose a wrap anyway? The wrap is something that is done AFTER settlement so it is none of the lender’s business.
What is a JV wrapper?
There are a few lenders who will do a fully disclosed wrap but their response is “we don’t care what the borrower does after settlement”. I have done a few of these myself so it easier not to tell them. You don’t even need to tell your broker.
The rental income that you can use is only existing rental or market rental. They will NOT use the amount paid by a wrapper as rental income for servicing because it is not existent at settlement and may never eventuate.
Robert Bou-Hamdan
Mortgage Adviser0414 347 771
[email protected]
http://www.mortgagepackaging.com.auFREE Finance-Related Newsletter – Click Here
Comments made are of a general nature and should not be construed as individual advice.
© 2004 Mortgage Packaging Pty LtdThat wrapper in Newcastle is Peter Sollner I think.
You are supposed to disclose a wrap as the mortgage contracts require the lender to be notified if anything is done to affect the value of their security. including onselling on an installment contract and selling an option, (major renovations etc).
Terryw
Discover Home Loans
Mortgage Broker
North Sydney
Click below to email meTerryw | 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
Are there any penalties from the lenders for not disclosing then terryw?
Michael_C they can pull the loans.
Rgds.
Lucifer_auwhen you say pull the loan, can you please explain what you mean for me please.
They can NOT pull the loan!
Also, a wrap does not have to be disclosed if it was not in existence at settlement. If it came into existence later, as is always the case, so what if you tell the lender? They have no recourse at all if repayments are being made and title is still in the name of the borrower so they have lost nothing.
Robert Bou-Hamdan
Mortgage Adviser
http://www.mortgagepackaging.com.auFREE Finance-Related Newsletter – Click Here
Comments made are of a general nature and should not be construed as individual advice.
© 2004 Mortgage Packaging Pty LtdI beleive lenders could pull the loan. ie give you x days to repay the loan. This happend recently to a big ‘wrapper’ (allegedly for other reasons than non disclosure). Dig out some of those old mortgage agreements that you have and read through it.
I have an old one here, from a bank i won’t name (start swith an A and ends in a Z – with a N in there somewhere).
it states:
I will not do ….. grant any rights of any kind over the property.
And then, states the borrower will be in default if any of the provisions are breached. The bank can then do anything deemed necessary, including taking possession.
Terryw
Discover Home Loans
Mortgage Broker
North Sydney
Click below to email meTerryw | 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
Like you said Terry, that is an OLD loan document. I have not seen clauses like that since the UCCC kicked in to protect borrowers. Most non-coded loans use the same format as coded loans just to ensure the lender is covered.
Robert Bou-Hamdan
Mortgage Adviser
http://www.mortgagepackaging.com.auFREE Finance-Related Newsletter – Click Here
Comments made are of a general nature and should not be construed as individual advice.
© 2004 Mortgage Packaging Pty LtdIts not that old, 3 years! And I beleive that other wrapper had his loans called in approx 12 months ago.
Brokers can even lose their accreditations with certain banks for doing non disclosed loans.
Terryw
Discover Home Loans
Mortgage Broker
North Sydney
Click below to email meTerryw | 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
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