All Topics / Help Needed! / ALL ADVICE WELCOME!!

Viewing 3 posts - 1 through 3 (of 3 total)
  • Profile photo of olivia001olivia001
    Member
    @olivia001
    Join Date: 2011
    Post Count: 1
    February 3, 2011 - 2:11 pm

    Hi,

    I am a real novice when it comes to property so sorry if i’m asking silly questions but i’m finding it really hard to get advice about properties.

    I am looking at buying a cheap piece of land (100K) and then paying 30K off within 2 years and using the equity to then buy a unit for 300K. All this has been approved by the bank but i was just wondering if anyone had any advice how i could rearrange loans etc to improve my tax or to save money any other way?

    I’m not looking to build on the land for a couple of years. I am in a different state to it and paying rent atm so i am keen so get a bit paid off the land and then go into a IO loan for the 300K unit.

    I know you are probably thinking that this land is a liability and it is, but it is a sale from a friend and a really good chance to buy something cheap which has good prospects.

    Any thoughts???????

    Thanks

    Olivia

    Profile photo of Richard TaylorRichard Taylor
    Participant
    @qlds007
    Join Date: 2003
    Post Count: 12,024
    February 3, 2011 - 7:05 pm

    Hi Olivia

    Welcome to the forum and I hope you enjoy your time with us.

    First thing i thing i would be doing is switch Banks as if this is the advice they have given you it is clearly not in your best interest.

    Flexibility is key when it comes to investing and we try where possible to ensure all of our clients loan structures give them just that. There is no point in paying down the loan to then redraw it at a later stage if there is some doubt that the interest on the redraw will be non deductible.

    There are a couple of tools you would recommend to a client to get to where they want to be but of course sometimes it is not in your lenders interest to offer this.

    Cheers

    Yours in Finance

    Richard Taylor | Australia's leading private lender

    Profile photo of sapphire101sapphire101
    Participant
    @sapphire101
    Join Date: 2006
    Post Count: 203
    February 4, 2011 - 6:14 am

    When you say cheap ($100k) what is it worth today? Have you had it valued?  Can you add value to it?  Then why do you think it is a good investment and that future equity will provide you with the buffer to buy the $300k unit. What is the future? 1 yr, 2 yrs, 10 yrs? Crunch your numbers. Work out what you are investing, to what your return may be ( will be). Then what you 'may' get in the next 12 mths, then 24 mths. After all you are the one paying off the loan on an investment that isn't giving you an income return.

    When you know what you are paying out, compared to your return and then are willing to work with that figure, then all is good.

    Ian
    http://theblockblog.com
    Free Property Tools & Resources for Investors (with a Sense of Humour)

Viewing 3 posts - 1 through 3 (of 3 total)

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