….I just need someone to point out how I can seize it…
ok heres the situation…
I recently bought a townhouse (so I dont have any equity to draw from), borrowing $180K which is pretty much my borrowing limit given my salary of $40K. My wife also earns an income of about $700 a week cash in hand (so she couldnt go in the loan with me).
a friend of the family has a unit which he is willing to sell to us for $140K, which is below market value, he fully owns it and the reason he wants to sell is because he is moving to darwin (where he fully owns a unit there as well).
Im pretty keen on buying the unit off him but obviously no finance co is going to lend me the money by myself and my wife cant really declare her income to help me out, so is there some way I can work it so that I can get this property?
Warrick
Dear Warrick,
There may be an investor here that is willing to offer you vendor finance.
Otherwise you may want to consider a low doc or no doc loan.
A person’s success is totally dependant on their perception. I have heard a lot of young people say that they “…wouldn’t be approved…” or “…couldn’t afford a mortgage…” Often these people are mostly held back by the negative perception of themselves and what is actually available to them. We have all missed and continue to miss opportunities because we lack commitment and/or don’t want to take the risk. Regardless of how sexy or attractive the potential financial gain may be, most of us steer away from dealings which could lead to stress.Once you have a good perception and confidence in your investment strategy then property seems so much more affordable. Once you realise you can afford a mortgage (or an additional one), you will come to realise banks love lending money, and will even lend money when it’s marginal. So if you can be bothered to dust off your suit and give them a good pitch in person, your half way there. I remember, (as will some of you), sitting across from a Home Lender thinking that he was a God like person with the ability to make or break my hopes for property acquisition. I remember giving a Home Lender 3 different payslips from 3 different employers, knowing in my heart I couldn’t afford the house, but in the end I convinced myself and the lender that it would work, and it did. I know it sounds bad, but tell them what they want to hear, without actually lying. The thing to remember about your next dealing with the bank is that financial institutions lend to “people” and not always their situation. One of my good friends has been working as a Manager for one of the primary lendors for a number of years now. After having off the record discussions he has revealed to me that he has declined loans where people could afford the repayments, but he didn’t trust their character. Like my situation from my youth, the reverse can be true where money is lent to marginal people who can’t really afford the payments, but their character suggests they are less likely to default. The moral of the story is to make a good impression, and if you make a bad one re-finance. Don’t be afraid to shop for a better deal, there shouldn’t be any loyalty when it comes to your money.
Kind Regards,
Mark Leith
Property Advocate
Global Buyers Agent
http://www.buyersagent.com.auHi Warrick
Further to Mark's comment about Vendor Finance, you may be able to Lease/Option the property from your friend (with the right to sub-lease). Good luck.
Cheers, Paul
Paul Dobson | Vendor Finance Institute
http://www.vendorfinanceinstitute.com.au
Email Me | Phone MeAn alternative way to finance your home.
Warwick
Have to disagree with a couple of points:
My wife also earns an income of about $700 a week cash in hand (so she couldnt go in the loan with me).
A) Being paid in cash is not a problem as she would still receive a Payment Summary and have to submit a Tax return. Obviously if she is defrauding the Tax Office by not declaring the income then that is a different issue.
With regards to Mark's Statement about going for a Lodoc loan I do not think he understands the purpose of such product. Lodoc loans are not a method of falsifying your income in order to increase your borrowing capacity.
It is very simple if you cannot afford it do not enter into such a contract until your circumstances have changed.
Richard Taylor | Australia's leading private lender
Dear Richard,
I agree with what your saying there is a lot of irresponsable lending going on in Australia and around the world. You only have to look at the sub-prime issue in America to see where our future could be heading.
However, in this situation $700 cash in hand means that she is not delaring the income to the tax office, so in this case a low doc loan would be appropriate as they dont have docs to submit but they do have the income to support the loan.
In addition, we are making all of these comments without knowing the return on investment or the vacancy rate of the area. This and many other factors need to be considered prior to even thinking about getting finance.
Kind Regards,
Mark Leith
Property Advocate
Global Buyers Agent
http://www.buyersagent.com.auGlobalMark wrote:Dear Richard,I agree with what your saying there is a lot of irresponsable lending going on in Australia and around the world. You only have to look at the sub-prime issue in America to see where our future could be heading.
However, in this situation $700 cash in hand means that she is not delaring the income to the tax office, so in this case a low doc loan would be appropriate as they dont have docs to submit but they do have the income to support the loan.
In addition, we are making all of these comments without knowing the return on investment or the vacancy rate of the area. This and many other factors need to be considered prior to even thinking about getting finance.
Kind Regards,
Mark Leith
Property Advocate
Global Buyers Agent
http://www.buyersagent.com.auMark,
Sorry to keep disagreeing with you …
A LODOC loan will need an income to be declared. If a person is taking cash and ripping off the ATO and fellow taxpayers then declaring that income will expose her to data matching by the ATO.
Alternatively if a person was to lie and declare a higher income to meet the loan then the ATO may even ask for the taxation shortfall.
If declaring an income is an issue then a NODOC loan may be more effective.
Ciao,
Dear Morgage Broker,
I meant to say NO DOC, not LOW DOC. If they have the income but not the documentation then they should go for NO DOC.
Kind Regards,
Mark Leith
Property Advocate
Global Buyers Agent
http://www.buyersagent.com.auPS: I have recommended one of our clients to your service
You may get a call from him over the next week or so.
Just be careful with your no doc / low doc loans as there are alot of uncertainties in the air regarding that level of lending! Make sure you do research and speak to professionals about it, not a buyers agent who is better off giving advice about buying property and not the financial side
Just remember if she is being paid cash in hand, and loses the job and you are servicing the loan with her income you may have to factor in how much money she would make if she was on a taxable income.
I am by no means saying you can't service a loan, just speak to a professional about it.
How can i find out vacancy rate in a particular area.Any advise?
SC2007 wrote:How can i find out vacancy rate in a particular area.Any advise?
Make contact with several REagencies in the particular area you are interested in, ask:
How many properties they have on their books in the area.
and then ask,
How many of them are vacant at the moment.If they have let's say 100 properties in the area on their books and 3 properties that are vacant, then you have found a vacancy rate of 3%.
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