Hello Folks
I have some assets but my cash flow is poor….only $23k. Unfortunately a brain aneurysm took me out of the work force 16 months ago and unlikely to be able to work again for quite a while as I also have other health problems. I’m single father with 2 boys at Uni but my assets are such I can’t possibly draw on assistance….and I wouldn’t anyway. My house is worth $900k and I own it plus I have 2 x investment properties. I owe on these but both are good investments: growth on one from $315k (all borrowed) to $530k in 3 years and the yield is 9%. The other has grown from $150k (half share value) to $350k (half share value) in 4 years and the yield is 7% (I owe $100k on this one). As I’m in recovery I can’t possibly think of selling any of them at present ….although I might not have a choice. I did have a third property that I recently sold as it was heavily negative geared and I lost on the deal. My savings have gone down to about $130k so I need help in what I could do to make the most of it in a cash flow. I don’t know anything about stock market or investment funds. Any great ideas from you guru’s would be appreciated.
Thanks
Carpe_Diem
[confused2]HI Carpe Diem,
Not a guru but will have a crack at answering your question.
Couple of details will be useful.
Loan debt on IP no 1? 530K value.
Expected years before an income will be coming in again.
How much per annum do you want now?
Derek
[email protected]
http://www.pis.theinvestorsclub.com.au
0409 882 958
Skype – derekjones2113Hi CD,
Thanks for the offline details.
I’ll post an approach here that will. in all likelihood, provide some debate.
As it currently stands you are asset rich and cashflow poor so an option may be a reverse mortgage or modification thereof.
Currently your debt level is 23% of your overall property portfolio – own home included.
Breakdown each of the three properties and you have 100% ownership of your home, 59% of your first investment property and 29% of investment property 2. Some ‘experts’ would say you almost have enough equity to adopt a living off equity approach.
Using such an approach you have accessible equity in each of your three properties which will (with a good broker) enable you to go to a no-doc lender and borrow up to 70% (with Macquarie @ 6.98%) or 80% (with RAMS @ 7.24%) on each of these properties.
If you really wanted to you could conceivably access additional lines of credit valued at $630K (against own home through Mac), $56K (against IP1 & with Mac) and $145K against IP2 (also with Mac).
You could conceivably push the envelope even further if you used RAMS by a further total of $174K if all loans were placed with RAMS.
During this process you would also be able to unlink loans if in fact they are linked or cross collateralised.
Given it is one year before you return to work and you only require a further $37K (above exising cashflow) it would be possible to live off the IP2 line of credit very easily indeed for almost 3.5 years even allowing for some capitalisation of interest within this line of credit and not allowing for any further growth in your properties.
In effect IP2 will provide you with your income for the ‘off work period’ with time to spare.
As an aside if you do pursue this approach ensure you set up at least two lines of credit. This will allow you to clearly establish what is deductible and what isn’t.
Use one line of credit for personal expenses (clothes, groceries, home bills, travel, car etc)
Use another for all investment related expenses including loan interest and all of this interest will be deductible.
If you really wanted to, you could use some of the available funds in a managed share fund.
I would suggest something like Navra (note I am shareholder – so do you rchecks and balances).
Based on a track record of 20% the previous (04/05) financial year and currently tracking at 15% at this stage of the 05/06 financial year.
Assume you invest $200K in this fund taken from your home line of credit.
At 7% this will cost ~$14K in borrowing costs.
At 10% returns this will realise $20K less costs and realise a net return of $6K.
At 20% return the net gain increases to $26K.
Obviously this is not something for the feint hearted but it will certainly tie you over. You may also want to grab a copy of Michael Yardney’s new book – it explains the living off equity set up very well.
Please note that this should not be construed as advice – it is the ravings of a mad man and needs to be considered in this light.
Hope this helps.
Derek
[email protected]
http://www.pis.theinvestorsclub.com.au
0409 882 958
Skype – derekjones2113Originally posted by Derek:Hi CD,
Thanks for the offline details.
I’ll post an approach here that will. in all likelihood, provide some debate.
As it currently stands you are asset rich and cashflow poor so an option may be a reverse mortgage or modification thereof.
Currently your debt level is 23% of your overall property portfolio – own home included.
Breakdown each of the three properties and you have 100% ownership of your home, 59% of your first investment property and 29% of investment property 2. Some ‘experts’ would say you almost have enough equity to adopt a living off equity approach.
Using such an approach you have accessible equity in each of your three properties which will (with a good broker) enable you to go to a no-doc lender and borrow up to 70% (with Macquarie @ 6.98%) or 80% (with RAMS @ 7.24%) on each of these properties.
If you really wanted to you could conceivably access additional lines of credit valued at $630K (against own home through Mac), $56K (against IP1 & with Mac) and $145K against IP2 (also with Mac).
You could conceivably push the envelope even further if you used RAMS by a further total of $174K if all loans were placed with RAMS.
During this process you would also be able to unlink loans if in fact they are linked or cross collateralised.
Given it is one year before you return to work and you only require a further $37K (above exising cashflow) it would be possible to live off the IP2 line of credit very easily indeed for almost 3.5 years even allowing for some capitalisation of interest within this line of credit and not allowing for any further growth in your properties.
In effect IP2 will provide you with your income for the ‘off work period’ with time to spare.
As an aside if you do pursue this approach ensure you set up at least two lines of credit. This will allow you to clearly establish what is deductible and what isn’t.
Use one line of credit for personal expenses (clothes, groceries, home bills, travel, car etc)
Use another for all investment related expenses including loan interest and all of this interest will be deductible.
If you really wanted to, you could use some of the available funds in a managed share fund.
I would suggest something like Navra (note I am shareholder – so do you rchecks and balances).
Based on a track record of 20% the previous (04/05) financial year and currently tracking at 15% at this stage of the 05/06 financial year.
Assume you invest $200K in this fund taken from your home line of credit.
At 7% this will cost ~$14K in borrowing costs.
At 10% returns this will realise $20K less costs and realise a net return of $6K.
At 20% return the net gain increases to $26K.
Obviously this is not something for the feint hearted but it will certainly tie you over. You may also want to grab a copy of Michael Yardney’s new book – it explains the living off equity set up very well.
Please note that this should not be construed as advice – it is the ravings of a mad man and needs to be considered in this light.
Hope this helps.
Derek
[email protected]
http://www.pis.theinvestorsclub.com.au
0409 882 958
Skype – derekjones2113Hello Derek
Wow this is some response! I thought I was in a position of not being able to borrow with no employment but you seem to be saying this is not an issue. Lots of stuff in your note that I’ll have to digest as its different thinking. It may well work out that I can’t go back to work while at the same time you’re saying I think that I could live off equity of these properties until the time is right to sell the properties that are particularly of high interest to developers. I’ll get hold of the book you suggest and have a read. If you were me who would you arrange an appointment with to discuss the use of equity to get me out of my current cash flow problem before I lose more of my savings. Alternatively should I spend the savings first before going for living off equity in the event I do go back to work?
Derek, I appreciate very much your efforts in responding to my cry for help. I don’t know how the star system works but I gather you didn’t earn 4 easily overnight. In fact as a new member on this site as of yesterday I’m impressed by the response that other members are making to their property mates on all sorts of questions.
Cheers
Carpe Diem
[suave2]Originally posted by carpe_diem:Quote:Originally posted by Derek:I thought I was in a position of not being able to borrow with no employment but you seem to be saying this is not an issue. Lots of stuff in your note that I’ll have to digest as its different thinking. It may well work out that I can’t go back to work while at the same time you’re saying I think that I could live off equity of these properties until the time is right to sell the properties that are particularly of high interest to developers.
Yes, it is different thinking and the approach does create some debate. It would certainly pay you to do a little more research.
Note this approach really requires that you don’t sell the properties as it is dependent upon achieving growth a consistent basis. It also requires that you maintain debt at safe lending levels and this is where a good broker can come into their own. But you will see from the table I sent you that at a compounding $37K per year you are drawing funds at a level that is largely sustainable. In all likelihood you could drawn more and very safely so too.
Having all of your properties in one city may negate the living off equity approach as Australian cities move in different cycles fro one another.
I’ll get hold of the book you suggest and have a read.
Good choice.
If you were me who would you arrange an appointment with to discuss the use of equity to get me out of my current cash flow problem before I lose more of my savings. Alternatively should I spend the savings first before going for living off equity in the event I do go back to work?
There is a financial planner who specilaises in a living off equity approach. He is based in Sydney and it would be worth catching his next workshop.
The only advice I would provide is to set this up earlier rather than later. This will relieve a great deal of tension from your life and make things a little easier.
Check out his website at http://www.navra.com.au and more specifically the link to http://www.navra.com.au/index.asp?content=courses#topics where you will be able to register for the next course.
As indicated earlier I am a shareholder in Navra so take that comment with a grain of salt. In saying that Steve has received wide acclaim for his course but does ‘cop a bit’ from people who do not believe that Living Off Equity can (and does) work.
Steve also has an added extra in the equation which is a ‘cashbond’ – put simplistically it operates similar to an annuity.
The living off equity approach is something I am currently work towards and would be more than happy to answer further questions.
Derek, I appreciate very much your efforts in responding to my cry for help. I don’t know how the star system works but I gather you didn’t earn 4 easily overnight.
Been a while gathering them [biggrin]
In fact as a new member on this site as of yesterday I’m impressed by the response that other members are making to their property mates on all sorts of questions.
Derek
[email protected]
http://www.pis.theinvestorsclub.com.au
0409 882 958
Skype – derekjones2113Thanks Derek
Still stewing about all this Derek but some good ideas nevertheless. I’m wondering how others on this site are feeling re this idea of living off equity. So far noone has responded. Sorry to say this but my research so far does not hold Steve McKnight in a high regard particularly in respect of the ‘wrapping’ legal matter.
Carpe Diem
[confused2]Greetings
Sorry to hear of your illness, but glad you have such a great asset position to make life easier.
Personally, all my investments are in property, but if I had a large amount of equity and wanted cashflow in the current economic climate I would personally consider investigating
1) Maximising your available cash by refinancing all your loans at 80% equity.
2) Select a range of investment options with good growth and cashflow returns: currently these might include shares in the form of managed funds, resources etc: seek qualified financial advice on this front. I’d be paying someone by the hour to help me choose the best plan (rather than paying eg 1% managment costs) and also take into account the advice on this forum and your own feelings.
Note once you are buying shares or similar there is a risk of loss of capital, so take this into account in your risk profile. Perhaps there are bonds or similar with a lower risk but still a good return: if you are borrowing for this you may be able to count this as income to help get the interest rate down.
3) If you don’t mind this level of personal involvement, perhaps commercial property if you can find something which you are comfortable with.These are all just ideas for you to check out, and I’m sure others in this forum can add to or contradict these!
Keep smiling though,[biggrin] you are in a good financial position: plenty of aspiring property investors on this forum would love to hold your asset position!
[smiling]Look on the bright side
Hello Zeng
Thanks for your kindness and contribution of good ideas. The penny is certainly starting to drop and I must say I’m a bit embarrassed that I know so little despite what assets I’ve accumulated in bricks and mortar.
Before coming to this site I was thinking I would have to sell at least one of the assets to get more cash to get me through at least the year ahead but what I’ve got out of all this so far from Derek and yourself is that no don’t sell. Rather what I should do is refinance all loans and take out a loan on my residence (all up to 80%) and the excess is what I borrow for converting into cash flow. I’ve then to find shares or whatever other investments that are going to yield cash flows over and above the new loans interest rates. So for example, if I borrowed say $500k interest might be roughly $37k and as long as the investments are returning roughly 15% then net cash flow will be $37k for me to spend. Apart from all the tax fix ups etc is this it in a nutshell? Is this the way I take up the discussion with a financial adviser? This is such a good site and there is a lot of material on here that I will be perusing over the next couple of months that I need to let sink in and think about before I actually take the plunge. Please let me know if I have misunderstood the main thrust of what you think I should be doing.
Thanks a lot……..I appreciate the time and effort that both you and Derek have so far put into this.
Cheers Carpe_Diem
[fez]Hi Carpe_Diem
Derek had a few good ideas. I love the living on equity concept as you get to keep a property which you would otherwise have sold. If you keep it you get all future growth as well, which you would love if selling (plus all the costs etc).
Hopefully your properties are in high growth areas.
Just keep in mind that most No Doc lenders will only lend for investment purposes. You can borrow against your own home, but must be for further investments.
Terryw
Discover Home Loans
Parramatta
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Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Hello carpe_diem,
After reading your posts I think the problem is not lack of cash or ability.
But rather lack of knowledge.
Thus you should not do anything until you yourself understand entirely what action you are going to take.By all means seek advice but check it.
Use more than one source for knowledge.
Do your own research as along the way you will pick up opportunities to look into.
Find a few mentors to guide you and check them.Most people give advice based on some knowledge they have but most never adequately use that knowledge them selves.
So only take notice of those who have actually walked the walk before you.There will also be a lot of people who will offer to help you invest.
Beware of sharks sad to say this but tricking (stealing) is far easier than working for a living and all too often our legal system fails to protect us from our own ignorance.
I shall say it again if you don’t know don’t do anything until you do.This great opportunity will disappear if we don’t act quickly.
Knowledge is the best opportunity, it will not disappear.
Nor will good investments when you know what you are looking for you will find them your self for your self.
Besides often the best investment opportunities are the ones you make yourself, you will realize this when you know this trust me here (check what I say, that goes for everyone).Beware of joint ventures most of the people involved in this don’t have the money to make their deal work.
Always remember Murphy’s golden rule “who ever has the gold makes the rules”.
Again stay away from joint ventures until you are capable of putting one together yourself for your project.When people realize that you have some money it is amazing just how many friends you suddenly acquire.
Be careful do not offend but slam the door shut and lock quickly.Last year a friend asked me for a loan, I looked at his proposal and thought it was a great idea but told him to go out and sell on consignment and if it works step up the orders and the scale of the business.
After explaining that since businesses want their products sold they often advance some of their product to retailers 30 days in advance of payment and if you don’t sell it they take it back and since they are not expecting the money for 30 days the quicker you sell it the faster the cash is yours to use for the short term.But no this friend bitched to some other friends who asked me why I didn’t help him.
So I explained that he didn’t need financial assistance he needed knowledge and if he wasn’t going to listen than he will not acquire either.I know 4 people who have won lotto and all of them owe more now than before their win.
Yet several friends dug in and worked hard and learned how to invest and today they have a better quality of life.
Regardless of incomes when we start out in life knowledge is the biggest separator.carpe_diem I wish you all the best.
There is a lot more to fishing than a worm and a hook so.
Just take your time learn as much as you can Colin.You can know the name of a bird in all the languages of the world, but when you’re finished, you’ll know absolutely nothing whatever about the bird… So let’s look at the bird and see what it’s doing — that’s what counts. I learned very early the difference between knowing the name of something and knowing something.
Richard Feynman (1918 – 1988)Knowledge is of two kinds. We know a subject ourselves, or we know where we can find information on it.
Samuel Johnson (1709 – 1784), quoted in Boswell’s Life of JohnsonMankind have a great aversion to intellectual labor; but even supposing knowledge to be easily attainable, more people would be content to be ignorant than would take even a little trouble to acquire it.
Samuel Johnson (1709 – 1784), quoted in Boswell’s Life of JohnsonYour friend Colin,
Email [email protected]
Home 02 46531376.
Fax 0246531079
Mobile 0425201055 (best contact as always working).
For all your CLEANING and GARDENING work.Thanks TerryW for your comments.
Thanks Colin. I’ll reply properly to you down the track as without going in details I will be away from tomorrow for about 3 weeks for medical reasons. There is a lot in what you’ve said and I appreciate your efforts, ideas and being generous with your time. I do lack the knowledge and I’m sorry that I’d not become more informed previously but its taken an illness to push me into a new direction that I trust will save the assets that I have already at least. They are good properties …all in the inner part of Canberra city with 2 of them in higher rise redevelopment zones. Trust you don’t mind my delaying my response until I return and by then I expect all that has been said by all parties will have been digested which means I’ll drive you mad with more questions.
Thanks again…
Carpe_Diem[happy3]Dear carpe diem,
That is the basic thrust of what I would personally consider doing in you position, but you need to educate yourself about the options and the risks. Pour a few dozen hours into reading through this forum and also somersoft.com/forums. This will add to your knowledge of handling the properties you have, and learn other peoples ideas of where to invest now. The risk with shares is that the share market slows down or crashes after you invest, leaving you with more debts and repayments than you have presently, without the planned on return! Not good. Unfortunately, we all lack the crystal ball required to see if/when that will occur: many seem to think we have a year or so of good performance before that is likely, but wild cards like bird flu or terrorism could mean all bets are off! Selling is an option, but it seems to me that you have plenty of equity, which basically means plenty of time to plan that. I would think you can likely hold on till prices start increasing again. Certainly you can access most of the equity by refinancing, and can still sell later if you want. Once you sell, you pay various costs (incl agents fees + taxes) and burn your bridges on that particular property. If resources keep performing for a year or more and you don’t get burned, you can create some income, possibly reduce your debt, and learn more along the way to assist in your future investment. Chat to a good mortgage broker about the best way to borrow. While you may be close to being able to live off equity, I personally don’t like the installment bond approach: seems like unnecessary jiggery-pokery, surely a lodoc or nodoc will be available. I’d be looking instead for an investment offering genuine cashflow such as managed funds or resources shares, but make your own risk assessment (and note I have never done this myself!)
Good luck on your journey[biggrin]Look on the bright side
Hi Carpe-Diem,
I realise it will be a couple of weeks before you read this – and I wish you the very best re the medical operation you are facing.
Just wanted to add that you are already where I want to be financially – so well done. From what I read, you have already amassed over $1m in equity – at that point I believe Living Off Equity is almost a doddle.
Look at it this way. Any lender will immediately lend up to 65% as a pure “Asset Loan”. In other words, they don’t care what you owe, or earn, as they have the right to sell a property worth 50% MORE than what they are lending. This is your “safety net” – many will lend on a far better basis – but this is the worst it gets.
As I understand it, you have at least $1.2m equity, but just don’t know HOW to access it. Can I say “You are in VERY GOOD SHAPE” and that must be because of the decisions you’ve made up to now. So, for that, congratulations – you’ve done well.
Based on Derek’s response (that you only need $37k per year to live) you are a shoe-in to not need to work for the next 20+ years. And if you retain the current properties, their value would at least double over that period – probably far more – therefore allowing you to borrow more to take you over the following 20 years.
I am getting close to being able to do this, but I think you are “already there” Enjoy,
Benny
this ‘living off equity’ as Derek and terry have described is really exciting stuff….i know cos IM DOIN IT! YIPPEEE.
I found myself in a similar (tho not as rich) situation as you carpe_diem. widowed, 4 kids, a PPoR and juggling two IPs to keep them below the asset level to be eligible for Parenting Payment. AND i was managing this, but I was frustrated in not being able to move forward toward financial independance.
A friend invited me along to a Bill zheng seminar. He is the spokesperson for a group called Investors Direct. You can do your own google on them. Essentially they are brokers and they talk of drawing on equity to finance deposits for investment properties. I wasnt sure they could do anything for me but I emailed them with a ‘wot the hell’ attitude, giving them all my details.
They described, using a spreadsheet (making it easy for a dummy like me) just how through accessing my equity, and purchasing more IPs, but also spending further equity on living expenses and other costs, i can increase my assets phenominally. Ive been pretty p’d off with Centrelink so I was eager to embrace a scheme that meant giving them the flick. To think I have been madly trying to keep hold of my Parenting Payment when it is only worth 13k a yr!!!
So where am I now? I have freed up $400k of equity on my PPOR. Of that $130k is kept as holding ( for paying interest, renovations living expenses etc) ANd I get $270k to go shopping for houses with. YAY. As I have a no doc loan I have to put down 30% deposit but I can still find 3 or4 houses in and around brissy.
One of the hardest thing for me was getting my head around ‘using debt to service debt’. [wacko]Using the equity to make up the shortfall taht rent wouldnt cover. The other thing I find difficult is switching my leanings from cf+ properties to capital growth properties. As i love renovating Im gunna be lookin for the run down hovels in the good areas if you lot out there havent got there before me [wink]
I hope this is an encouragment for others out there who feel they cant get into IPs because they dont have a job.
goodluck to you carpy
Good on ya milly, you certainly have found a good formular, however how long can you survive with $130k going forward including cost + repayment. I assume you’ve buffered in the 30% LVR for low Docs.
I plan to do the same with my IPs … and I am basing on a 60k tax free living per year (that’s like $100k PAYG) however, with my limited equity, I can only afford to live for a few years before drying up my equity.
I believe the best formular is to have at lease 5 years of equity; based on Robert Ky.. the 72 rule. Interest rate x 72 = numbers of years that an investment will double. 6.5 * 72 = 4.7 years.
So… If I have $2M worth of Asset (IP), I need 30% LVR ($600k) + Living Equity ($300k) and leaving a loan of $1.1M before I can live off equity and stress free..After 5 years, I’ve used up $300k but my IP are now worth $4.0M So can I afford to increase my equity living to …OMG $400k pa… based on 2M worth of Equity for another 5 years…
That’s my plan.
Carpe_diem, Good luck and I hope my example gives some enlightenment.For others, keep accumulating IPs… as the next wave of boom might hit any time and the questing is… will you be on it.
Regards
ptnthis is good ptn. thanks for explaining your formula. I havent really given enough thought on how long I can last on $130k which is why I am very careful of where I buy in the next few yrs. I need to buy where I am confident they will increase in value so I am able to refinance in 2 or 3 yrs time. I am counting on properties doubling in value every ten yrs. ie 10% per yr. Altho they never do rise neatly at 10%/yr.
But remember I have less at stake than most. I am not chucking in a 100k/yr job. I’m chucking centrelink’s 13k/yr. Actually I only received 6k from Centrelink last yr as I work casually as asupply teacher. I see no reason not to keep working one or two days a week teaching. It is amazing how much fun teaching is when you dont HAVE to work.
goodluck ptn on your own venture. Lets hope we have prodded a few others to take the plunge.
Dear Derek, Zeng, Colin, Terryw, Benny, ptn and Marvellous Milly,
Just a note to let you know I haven’t forgotten you! I’m pleased to tell you I’m going quite well after two more medical procedures on my head – radiation for benign but pressurising tumour and transposition of the nerve that controls the left side of the tongue to elsewhere in the face to perhaps rectify facial paralysis that unfortunately was a result of the brain aneurysom operation I mentioned to you previously. Anyway, life is beautiful still as I spend my time in Coffs Harbour (young son at uni here) soaking up what the surf, jetty etc offers. This may sound absolutely terrible but I could hardly wait to climb out of the effects of the anesthetic to resume digesting all the ideas you have provided. I must say a great thanks to you all for reducing the tension I was feeling about how I could possibly survive with such a poor cash flow. No doubt it has been significant in my dealing with the medical procedures and has heped me in my recovery. I’ll always remember your generosity.
I know I have good properties (2 of the 3 are zoned for 2 and 3 storey redevelopment) and know they will keep increasing in value so I’ll be doing everything I can to keep them…..in fact their value is going up by 10% minimum pa so that makes the overall value increase by 170k for the coming year alone. So I need to get out there and borrow say 500k and invest it well so that it pays off the interest, keeps me surviving and invested well so it makes some gain so that say after 5 years it hasn’t all gone. But anyway on my calculations the debt ratio increases from 23% at present to 56% on borrowing but after 5 years even if I spend the whole 500k my debt reduces to 36% based on the 10% gain each year.
Not sure what I’m going to invest in yet as I’m still to catch up with a good broker and a financial adviser (thanks Zeng for the tip of paying for the hour for good investment advice…I like that idea). I’m even thinking perhaps I could borrow to redevelop a block down the track now that I know I don’t have to be ’employed’ to borrow. Thanks Marvellous Millie for this idea of focusing on capital growth rather than cash flow to really expand on your investment. Currently I do have to focus on cash flow but down the track I’ll be taking this idea of yours and PTN’s into more serious consideration. In fact it has happened that way for me….accidentally….as you know I’ve shown terrible lack of knowledge re investing and the only thing I knew when I did purchase the 3 properties I have is location, location, location! Such thoughts of redeveloping a block that I own of course is easier to make when you’re lying on the sands of a beach and when I get back to Canberra things may change ie I’ll probably soften and go for a more conservative approach for awhile until I sort out my health and work situation.Thanks a lot Derek for the detailed information you’ve supplied me. I’ll be in contact soon to ask more questions. Thanks also to Benny and Terry W for the good advice and encouragement….there is lots for me to learn ie I have no idea what nodoc lender means. I hope one day I’ll be able to pass on tips to others who can gain from them.
Colin….I was amazed by your note and still trying to figure out how you manage or what you do to ‘be careful to not offend (money chasers) but slam the door shut (in their faces) and lock quickly!!” This could be handy but ….I’m sure there is no way to not offend them. Thanks for all the great advice. I’m appreciative beyond wordsI wish you all to attain an early realization to what you want to achieve.
Kind Regards
Carpe-DiemHi Carpe-diem,
Sounds like you “seized the day” – and good for you. And I love what I read from you:-
in fact their value is going up by 10% minimum pa so that makes the overall value increase by 170k for the coming year alone.You’ve got to be on a winner right there, CD. If Derek is right, and you only need $37k pa, this HAS to be good news, right? Isn’t that the next 4 – 5 years already taken care of? Even if not quite right, it does tend to give a good idea about the value of equity growth, yeah?
Anyway, it’s good to see you are back with us again, and charging forward. Keep on reading, and adding to that “store of knowledge” that allows you to make the best decision for YOU. For me, it’s amazing just how LIBERATING this knowledge can be – I wish the same for you,
Good luck,
Benny
I am new to Living Off Equity, and was windering how you each feel and/or went with this approach now its over a year ago since these discussions and advice?
I am hopeful, but struggling to service my debts = I have 2 Inv Props and a home worth a total of $2.3 but loan debt of $1.3… ALl props are inner bayside and appreciating well…
Advice?
mike
Hi, I feel for you & pray that your health recovers quickly.
I'm about to refinance my properties for cashflow & am thinking of capitalising the interest on a million dollar loan for 5 years. Needless to say, the worry is making me sick.
The point of difference I note is that your PPOR forms the bulk of your assets. You might want to think about this. I have roughly the same equity as you with the difference that my house is $320000 [value], current loan $225000
Apart from that, I can't think of anything else to say except to wish you well.
Kum Yin
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