Hello all the experts
This is the situation I am in:
My partner and I have 2 mortgaged properties in Perth.
1 An inner city apartment we are living in, bank valuation was 980 K ( Last month) , mortgage on it is 450K
2 A house in the hills, currently rented out at $200 a week, bank valuation was 520K ( Last month), mortgage is 360K .We have 90K cash in a savings account.
My partner has a small business in IT, he get paid over 120k PA. ( after tax )
I am not working at the momnet.
I would like to create an income for myself through property market.
Can any one tell me what are the options?As I got plenty of time , I am thinking about buying a property and renovate it, but I am not sure if I can get a loan at this stage.
Thanks in advance
On the basis that you register an ABN you could consider making application for a Nodoc loan where no evidence or declaration of income is required.
It is likely that you will need to provide between 20-30% deposit for each purchase as well cover the acquisition and refurbishment costs but this could be drawn from your existing properties if structured correctly.
In saying this there is nothing to stop you buying with your partner on a Tenants in Common basis where you could have his income taken into consideration yet you enjoy the majority of the profits.
Only thing to consider is the early exit fees charged by most lenders when it comes to buy, renovate and sell style loans.
Richard Taylor | Australia's leading private lender
Hi there, you seem to be in a very good financial position from what you wrote, you should not have any problems borrowing money as you have plenty of equity in your properties as well as good savings. A few things you can do over the next few days that will cost you nothing:
1-Call an experienced broker so you can start exploring your borrowing capacity and options.
2- Leave your cheque book at home and start researching your market, see what sort of properties could give you income, talk to agents, local investors, etc, etc.
3 – Steve’s site and these forums are a great source of information on the “How To”, this will help you decide what strategy you want to use (renos, + CF or Vendor Finance)
4- On a clean sheet of paper, write a plan, start from the end, what do you want to achieve, and most importantly why?. Then develop your plan from there. See, a plan will help you to stay focused and in track. Your plan should include easy steps you can take every day that will get you closer to your goal, things like, read Steve’s site, call local agent, call the broker, organise paperwork for loan, etc, etc.
One last thing, the property that you have rented for $200, rent seems a bit low, call the agent that is managing it and shoot the question, this again will cost you nothing and could improve your borrowing capacity.
Happy investing
Also consider storing that 90,000 in a 100% offset account. Does you loan have redraw? If so consider paying down the home loan (non deductibel) and reborrowing for the new investment – don't just use the cash.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
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