I now have 8 wrap properties in 6 months and look to run out of capital soon for the 25% or even the 15%.
If I have no other source of income, does anyone know how to get more capital relatively easily?
My thoughts were: Find a low interest rate mortgage for 106%, but I havent found one yet; find an investor or two, but its expensive and time consuming to setup presentations and do seminars etc to find investors; Im on Sydney’s Northern Beaches and there doesnt appear to be any real estate investors clubs here; Im learning to trade the forex and futures markets but my backtesting has not been successful so far; I could get a job with someone but thats a last resort…….
What have other people done to solve this problem as Steve’s system is on pause.
Steve’s system has been giving good returns however I feel another 22 properties will get me a good base.
[biggrin]
As an update…….. I dont want to wait until the wrap properties appreciate to refinance that way, though I can. Any thoughts how to restart the system let me know……
Hi pwarde
If you have sold the properties via installment contracts, then you cannot increase the loans to access the equity – the equity is not yours.
If LOs, then it may be possible, but you have to be careful you don’t borrow more than the tenant will be buying the property for.
If you have run out of capital, then you will have to save more, start working or just wait for someone to cash you out – but by then you will have noticed prices have increased, and you will need even more deposit for the next one.
Getting 8 properties in 6 months is a very good start. I think Steve was only able to do so many because him and Dave were still working in their accountancy practice in the early days.
Terryw
Discover Home Loans
Parramatta
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Terry Wrote:
“If you have run out of capital, then you will have to save more, start working or just wait for someone to cash you out – but by then you will have noticed prices have increased, and you will need even more deposit for the next one.”
Thanks for your opinion, I DO appreciate it Terry, more specifically I have run out of credit not capital, as the credit I have at present is limited by the assets I can leverage. There is plenty of capital out there which will lend against your credit rating, like credit cards and personal loans but it is getting the capital as cost effectively as possible while managing risk.
I stopped working for someone 14 years ago, so its not really an option for me. I stopped saving about the same time as the government liked taxing me too much, Im cashing out the properties as we go by managing the delta between interest only and P&I.
So I need some really clever ideas to solve my problem. There has to be a way around it.
It needs to be a method which does not incur the wrath of ASIC. Any ideas?
To avoid ASIC’s wrath it looks like it needs to be in the form of a loan, joint purchase of the property or the purchase of shares in a company.
It appears, amongst other things, you cant offer an investment, any finance vehicle that does not have a guaranteed return or pooling of funds.
Hi pwarde
Two possible ideas:
1. Find properties where the vendor is prepared to leave 20% to 30% behind in the form of a second mortgage. In this flat to declining market, it’s not that hard.
2. When Karen & I came to this point awhile back, we asked Rick Otton the same question. One of his answers was, “flap your gums”
We did and now we have people coming to us requesting to become Joint Venture partners.Good luck.
Cheers, Paul
Paul & Karen Dobson
negative2positive
Turn your negatively geared property into positive cashflow.
Phone: (02) 4984 9540Talk to us about Wrap Training Joint Ventures.
Paul Dobson | Vendor Finance Institute
http://www.vendorfinanceinstitute.com.au
Email Me | Phone MeAn alternative way to finance your home.
Thanks Guys nice suggestions. Good luck with your businesses
We did and now we have people coming to us requesting to become Joint Venture partners.You must be logged in to reply to this topic. If you don't have an account, you can register here.
