All Topics / Finance / Financing additional IP’s

Viewing 6 posts - 1 through 6 (of 6 total)
  • Profile photo of Maria RodriguezMaria Rodriguez
    Member
    @maria-rodriguez
    Join Date: 2009
    Post Count: 1

    Hi All,

    I have just purchased my first investment property that a cheap rural 2bd unit, my question is how do you continually purchase more properties? How do you raise deposits to finance additional investment properties? My PPOR does not have much equity, Can anyone assist?
    Regards,
    Maria Rodriguez
    Profile photo of Richard TaylorRichard Taylor
    Participant
    @qlds007
    Join Date: 2003
    Post Count: 12,024

    Hi Maria

    Hate to say in the current climate this is a difficult one.

    Most lenders wont go past 90% LVR these days (although there are still a few doing 95%) but you will still need to access the deposit and acquisition costs.

    Course nothing to stop you purchasing the property as a PPOR, claiming the FHOG, satifying the FHOG conditions and then renting it out.

    Whatever anyone on the forum tells you no lender will allow these days a 10% second mortgage as proof of your deposit provided by the vendor so unless you have actual real savings you will have an issue.

    I assume you took the first loan to 95% on interest only ?

    Richard Taylor | Australia's leading private lender

    Profile photo of RudigaRudiga
    Member
    @rudiga
    Join Date: 2008
    Post Count: 41
    Qlds007 wrote:
    >Whatever anyone on the forum tells you no lender will allow these days a 10% second mortgage as proof of your deposit provided by the vendor so unless you have actual real savings you will have an issue.

    so what your saying is if you have a LOC on a property of say $50,000 with one bank. The other bank wont allow that LOC to be used for the deposit on a new Investment purchase???

    Profile photo of Richard TaylorRichard Taylor
    Participant
    @qlds007
    Join Date: 2003
    Post Count: 12,024

    Hi Ridiga

    No not at all. That is not what i said or meant.

    What i was referring to was many forum members are under the impression that if they can convince the Vendor to leave in say 10% of the purchase price plus costs in the deal and take security by way of second mortgage they will be able to finance another IP.

    Assume purchase price was $100K you pay the Vendor $90K at settlement which you borrow and 10K over say a 5 year period.
    Vendor is offered security of a 2nd mortgage.

    Traditional lenders will not accept these days a 10% Vendor financed deposit.

    Utilising a line of credit or similar is perfectly acceptable.

    Richard Taylor | Australia's leading private lender

    Profile photo of RudigaRudiga
    Member
    @rudiga
    Join Date: 2008
    Post Count: 41

    oh ok, sort of understand haha

    sorry for getting mixed up

    Profile photo of Richard TaylorRichard Taylor
    Participant
    @qlds007
    Join Date: 2003
    Post Count: 12,024

    No worries easily done.

    Richard Taylor | Australia's leading private lender

Viewing 6 posts - 1 through 6 (of 6 total)

You must be logged in to reply to this topic. If you don't have an account, you can register here.