I’ve been bitten by the investment property bug and wanted to get started ASAP.
At present, I have no deposit. It’s been suggested that I take out a small personal loan for the stamp duty/costs etc and 100% home loan. Is this wise, or am I better off waiting a little bit longer til I’ve saved the costs?
I’ve done plenty of research and I want to get into the market ASAP.
Thanks
RLThat would possibly get you into the market quicker. But you would have much higher repayments, so you would need more growth/rent to cover it. You have to work out if you think this is worthwhile. Also consider the effect of a personal loan on your home loan application. will you still be able to qualify? Personal loans have higher rates and shorter periods, making the monthly repayments high – this can hurt serviceability.
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Hi Redleaves. yes, that is a viable option for many people that have no or little deposit. Just an alternative suggestion (and as mentioned already, you will need to be able to service the both loans……) it would might be more sense to look at a more conventional loan @ 95% LVR matched with a larger personal loan, than the ‘No deposit’ 100% finance type homeloans along with a smaller personal loan, which usually have a higher interest rate (assuming this is for investment of course)THis could save you around 1/2 % on the interest rate using a discounted loan product. The idea would be to then clear up your personal loan asap. All the best hey!
[strum]I understand your enthusiasm.
The market is not moving up at the moment. Any purchase you make should be considered medium term investing at least.
My point is that should you decide to save a decent deposit over the next 12 months then I don’t believe that you will be paying a higher price than if you bought today. In fact many people are suggesting that you may even buy cheaper.
I put it to you that spending 12 months saving and researching your market might be a better strategy than leaping in with 100% borrowed funds now.
Of course I am no expert ….
Simon Macks
Residential and Commercial Finance Broker
***NODOC @ 7.15% to 70% LVR***
[email protected]
0425 228 985Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.
Originally posted by Mortgage Hunter:I understand your enthusiasm.
The market is not moving up at the moment. Any purchase you make should be considered medium term investing at least.
My point is that should you decide to save a decent deposit over the next 12 months then I don’t believe that you will be paying a higher price than if you bought today. In fact many people are suggesting that you may even buy cheaper.
I put it to you that spending 12 months saving and researching your market might be a better strategy than leaping in with 100% borrowed funds now.
Of course I am no expert ….
Simon Macks
Residential and Commercial Finance Broker
***NODOC @ 7.15% to 70% LVR***
[email protected]
0425 228 985Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.
Thanks MortgageHunter, I appreciate your thoughts.
Although it’s hard when I wanted to get started RIGHT NOW, I think I’ll save for the deposit and take it from there, esp if properties aren’t going to be moving upwards too much in the next 12 months.
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