Howdy
So we've decided to begin the Savings process for a Deposit.
Thanks to the Excellent Advice on here we plan to be a step ahead of the average person
We've worked out it will take us 6 months of savings( christmas is a bad time for savings) to get enough to satisfy the 5% and more.
I'm currently with St George bank and have been with them for 3 years + and repayed a $30k car loan.
We plan to build a realestate portfolio increasing 1 house per year if we're lucky/smart enough.
The first house will be obtained with Maximum capital growth,rental return and depreciation in mind, thus after 12 months of 100% offset in an IO loan there should be enough for another property, then repeat.So my question is which bank am I likely to choose after 6 months, if its anyone other than st george i'd like to change now, thus getting a bit of history with the bank and maybe more leverage to waver fee's etc.
Regards
Denis
Hi Denis
I would be deciding that now as most lenders will not do 95% unless you are an existing customer so you need to decide now and do your saving with this lender.
By the 95% Interest only maybe not be achievable in the current climate and also need to look carefully at St George so called 100% offset account
Richard Taylor | Australia's leading private lender
Hi Richard
Are your services available as a broker for this sort of thing?
Cheers
Denis
Hi Denis
Yes sure. Drop me an email and be happy to assist.
Richard Taylor | Australia's leading private lender
emails sent
ST G is one of the few lenders that will still do 95% loans for existing customers – must have an account with them at least 6 months – so don't close it yet. Keep your options open – but I agree about their offset accounts.
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
Yes
Even if your shifting your money around in the mean time, keep st goerge account open just for bookkeeping etc, they do have good introductory/honeymoon interest rates at the moment that are fairly competitive.(they also revert to a lower rate than standard variable at end of term too)
Congrats on deciding to go a head with an IP.
With the market showing a few green shoots its a opportune time.
Good Luck!!
The SGB special ends tomorrow.
Richard Taylor | Australia's leading private lender
Denis,
I am definitely on the same wave length as you, to acquire first property and purchase at least 1 every year. That is my exact goals, however hopefully trying to get more then just 1 per year!
I have just purchased, and settled last week, with CBA. My deal was fairly complicated, however we managed to pull it all through. There would definitely be ways in which to obtain finance for you.
In terms of which bank, it really depends. Policies changing all the time; lenders now requiring genuine savings to be sitting in an account untouched for 3 months or more. (3-5% depending on lenders). Unless, of course you can attach another security to keep lend under 80%, which would therefore not require the genuine savings rule, also avoiding LMI.
Try not to stress yourself too much into where you will look at purchasing. The main goal for you now, is to at least get in the market. It doesnt have to be the most extravagant. I researched for quite awhile, in terms of the areas to buy in. I have also been reading and watching seminars about investing – the main and most important thing, is to just get in the market. That is the stepping stone, once you are in, the rollercoaster then becomes a little smoother and easier. Regardless of rental return, or high growth, your main focus is just to buy, and BUY as soon as you possibly can. The next 12 months would be optimal.
I just signed up to this forum, and this is my first post. I read your thread, and felt compelled to write, as I am in a similar situation. However, slightly one step ahead with already having purchased.
Good luck Denis, you will get there in the end! Perseverance was a key factor with my recent purchase!
I hope this gives a little insight for you anyway..St.George also have a fairly decent product at the moment, with their spring campaign.
4.66% for first year, reverts to percentage discount after year one off SVR. The $395 annual fee, being the only hindrance..
However at least it eliminates establishment fee, and account keeping fees etc if you want to attach an offset account..Denis, to be honest – all you really will need in a loan, is your BASIC standard mortgage, no bells and whistles..
Nominate a savings account to be direct debited from each month; cheaper rate, ability to make extra repayments, ability to redraw..
Thats all you will need…. lenders, just seem to make the loans sound fancy, which makes them competitive; therefore meaning, making the consumers confused…the more confused the consumer, the more they will shop around on cheaper products..
Its a vicious little finance world…When you are looking for loan facilities/products – just get a BASIC mortgage!
Depending if you want a walk-in branch, ATMs etc….you can try the big 4, on a basic set up, which have decent rates at the moment. Or you could try some of the non-banks, which wont really have branches etc…
Totally up to you, and how you want operate it..
Howdy.
Thanks to All who have posted
We're probably going to stick with the dragon for now, in 6 months things may have changed and we'll reasses.
Sofar my only issue is with st george and their offset accounts.
Can someone who has a st george with an offset clear this is.
Apparently they have a really weird way of doing their calculations that effect the ammount calculated monthly.
I'm keen to go with the advantage pack as there are a few savings ie credit card yearly/loan establishment fee.
Again thanks for all the help.Regards
Denis.
P.s Richard did you get my email?
Advantage package is quite good;
Saving of fees, percentage discount on rate, and you can also get that discounted rate for the first year.
There is the annual fee of $395, you can have up to 5 loans for the one annual fee, which is great….the more properties you acquire, the cheaper it becomes in fees.I am not sure about their calculations though regarding the offset savings….what do you mean they have a weird way of calculating it?
If you have the adv pack, you can attach the offset account for free…which is good…
Hi Richard,
What is wrong with the St George offset account? I have just set one up for my new IP so would be good to understand if there are any pitfalls with it.
Thanks,
MattHi Denis – my 2 bobs worth is I would consider one of the Big4 banks.
Sounds like you are going to need Mortgage Insurance and the Top 4 banks have more pull with the MI's. For example we tried a non Top 4 bank and got turned down as my hubby had changed professions and didn't have 2 years work experience in his new field (despite the fact this is his 3rd trade qualification and has always been employed). Richard Taylor was able to assist us with securing the loan with a Big bank – same MI.
Cheers
mattnz wrote:Hi Richard, What is wrong with the St George offset account? I have just set one up for my new IP so would be good to understand if there are any pitfalls with it. Thanks, MattSt G's offsets come in 2 or 3 different versions. One (or 2?) version takes any savings off the principle. So with an IO loan and money in the offset, the loan will be reducing (same repayment amount). This is less than ideal as you could be putting the money to better use elsewhere. There is a version that has the savings result in a lower repayment, but you have to be careful to choose when setting it up.
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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