How does one borrow the deposit fro the MF from the bank to use as cashdown? What do you tell the bank you need the money for? Do I borrow 20%deposit money from MF& then borrow the other 80% from another bank?
Eg. We own a home 250K with no money owing. How much can that MF give us to use as a deposit? And what do you tell bank what needed for? And is it the same when I borrow against it again? What is the %age you should borrow against the MF?I have a deal that is more money than I can raise on my own. How can I get more money? If a property is positive geared & fully tenanted, shouldn’t a broker lend the money in full on the fact that it already runs on a profit? (I think is is 80%)
i don’t understand a word of this, but the answer is yes, or no. I think…
cheers
brahms
Purveyor of Fine Finances
aka Mortgage Broker BrisbaneMF = Line of Credit?
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958
Skype – derekjones2113oohh, all i could think of was Mo Fo, My Funder or Male Friend ! oops that could have be a bit of a faux pas!
well then fdb, if you already have an MF aka LOC then u simply draw down required funds and establish new loan to complete settlement.
Its a pretty straightforward process, simply engage the services of a proficient mortgage broker to sort it for you.
cheers
brahms
Purveyor of Fine Finances
aka Mortgage Broker BrisbaneI am with Brahms totally lost.
Richard Taylor
Residential & Commercial Finance Broker
**Lodoc Commercial loans from 7.39%**
Licensed Financial Planner
Ph: 07 3720 1888
richard@yourstatefinance.comRichard Taylor | Australia's leading private lender
What I mean is that the master facility has no debt owing. It is valued at 250K. If I want to borrow 20% from that and then 80% from another bank to get the full 100% of IP is that too risky? I believe that we will only get up to 80% of the property value from the main borrower. I don’t have any other funds to put with this so is this how I get the other 20%? Does that make more sense now?
fbd1
Are you referring to your PPOR as the Master Facility if so yes that is a sensible way to go. Are you purchasing the IP in Trust?
Richard Taylor
Residential & Commercial Finance Broker
**Lodoc Commercial loans from 7.39%**
Licensed Financial Planner
Ph: 07 3720 1888
richard@yourstatefinance.comRichard Taylor | Australia's leading private lender
Yes I am talking about PPOR as MF and thank you for your response.[blush2]
And yes I would be buying the IP in company trust.No problem
I think you mean you will be buying the property in Trust with a Corporate Trustee.Richard Taylor
Residential & Commercial Finance Broker
**Lodoc Commercial loans from 7.39%**
Licensed Financial Planner
Ph: 07 3720 1888
richard@yourstatefinance.comRichard Taylor | Australia's leading private lender
I am probably to blame for the MF terminology. I used it in my article: http://www.prosolution.com.au/articles/structure.pdf
How does one borrow the deposit fro the MF from the bank to use as cashdown?
You establish a new loan against a security (property).
What do you tell the bank you need the money for?
Future investing to purchase more property.
Do I borrow 20%deposit money from MF& then borrow the other 80% from another bank?
You can use another lender if you like. In my opinion it depends on who’s going to give you the best deal.
Eg. We own a home 250K with no money owing. How much can that MF give us to use as a deposit?
80% of $250k = $200k. This will give you enough money to purchase $800k of property. Use the MF for 20% plus costs and get a new separate loan for the remaining 80%.
And what do you tell bank what needed for?
Once again, future investment purposes.
And is it the same when I borrow against it again?
No, just establish one loan for $200k.
What is the %age you should borrow against the MF?
80% or whatever you need.I have a deal that is more money than I can raise on my own. How can I get more money?
Rob a bank (althought this is a short term solution). Partner with someone else. Look for a smaller deal.
If a property is positive geared & fully tenanted, shouldn’t a broker lend the money in full on the fact that it already runs on a profit? (I think is is 80%)
No, Most lenders only take 80% of rental income and look at loan repayments on a P&I basis at a higher benchmark rate.Cheers
Stu
Well dissected Stu.
Like your work.
CheersMal
Getting out of your comfort zone, can help you become comfortable
Hi All,
It would be worth calling HSBC to find out if they still take 100% of rental income into account. I’m 99% sure that they use to do it.
Todd Burns
http://www.freepropertyhelp.com.auHeh Stuart
We were looking at someone to blame for not being able to understand the original post so thanks for sticking your hand up.
Richard Taylor
Residential & Commercial Finance Broker
**Lodoc Commercial loans from 7.39%**
Licensed Financial Planner
Ph: 07 3720 1888
richard@yourstatefinance.comRichard Taylor | Australia's leading private lender
one more question relating to this???
If I establish a loan of $200K against PPOR, and for example only need $100K for an IP deposit, what will happen to the other 100K that has been approved? do I redraw when it is needed to buy another IP? Or will I have to establish another loan at a later date against the PPOR?Hi fbd,
If you set up your line of credit for $200K and only use $100K then you have at your hands an additional (and easily accessible) $100K. This will remain in the account until drawn.
In essence your first $100K is deposit for property one and the other $100K is available for another deposit.
In setting up the initial facility of $200K the bank has established that you have sufficient security and income to service the $200K when fully drawn. They would have charged fees etc based on $200K but will only charge interest on the amount drawn.
Derek
derekjones1@bigpond.com
http://www.pis.theinvestorsclub.com.au
0409 882 958
Skype – derekjones2113Hi Guys,
Thats fantastic information – Stu you ledgen……
I was just looking at different ways of funding another investment and that has helped me out dramatly. Well done. At first i was abit puzzled about the jargin but now its so clear and simple.
[jerry]Wealth Angel
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