All Topics / Finance / Best path to proceed

Viewing 8 posts - 1 through 8 (of 8 total)
  • Profile photo of LearningsLearnings
    Member
    @learnings
    Join Date: 2010
    Post Count: 7
    March 28, 2011 - 3:35 am

    Hi guys,

    Long time lurker looking for alittle advice please :)

    My head is a jumbled mess of novice finance

    PPOR Rental Appraise: 15k
    PAYG: 65k

    PPOR val: 385k
    PPOR loan: 308k IO (about to refi to drop repayments to 6.9%)

    I plan on moving out of PPOR into the CBD in shared arrangements with friends.
    I want to purchase a new place around 200k. Genworth rates the postcode to 95%.
    I'm planning on subdividing the backyard off and selling without permits. (council allows)
    I have upto 20k private finance to assist this process.
    The left over front property rents for around 200pw / 10.4kpa.

    The backup plans if im unable to get fulldoc:
    I have an old ABN which is untraded and not reg for gst but can get an 80% lodoc.
    Add in GF's 35kpa as guarentor to loan – not ideal
    Purchase a fixed income annuity/cashbond with private 20k and duck and weave between lenders to get it accepted.
    Attempt to purchase new property under option, use private 20k + LOC to fund subdivision.

    Any advice appreciated, I am very keen to get #2 happening ASAP.
    Brett

    Profile photo of ksherwellksherwell
    Member
    @ksherwell
    Join Date: 2007
    Post Count: 125
    March 29, 2011 - 10:41 am

    Sorry Brett bit confused, is the new place with the backyard to subdivide or your PPOR?

    Profile photo of LearningsLearnings
    Member
    @learnings
    Join Date: 2010
    Post Count: 7
    March 29, 2011 - 11:02 am

    Sorry just to clarify

    PPOR is un-developable

    So turn PPOR into IP and purchase a 2nd IP to subdivide off the rear.

    Has anyone sucessfully used a cashbond lately?

    Thanks

    Profile photo of luke86luke86
    Participant
    @luke86
    Join Date: 2010
    Post Count: 470
    March 29, 2011 - 11:28 am
    Learnings wrote:

    Add in GF's 35kpa as guarentor to loan – not ideal

    One thing you need to remember is that banks are not allowed to have a serviceability guarantor anymore (since the new NCCP rules I think). So to use her income for serviceability you will have to have the loan and the new property in joint names.

    Cheers,
    Luke

    Profile photo of Richard TaylorRichard Taylor
    Participant
    @qlds007
    Join Date: 2003
    Post Count: 12,024
    March 29, 2011 - 1:22 pm

    Nothing to stop her becoming a co borrower and as long as their is some financial benefit that will be ok.

    Good luck on a Cashbond to increase serviceability.

    Cheers

    Yours in Finance 

    Richard Taylor | Australia's leading private lender

    Profile photo of LearningsLearnings
    Member
    @learnings
    Join Date: 2010
    Post Count: 7
    March 30, 2011 - 10:53 am

    Are cashbonds a thing of the past or just very difficult to excute?

    Profile photo of cuteyoungchiccuteyoungchic
    Participant
    @cuteyoungchic
    Join Date: 2010
    Post Count: 66
    March 30, 2011 - 10:59 am

    What is a cash bond?

    Profile photo of Mick CMick C
    Participant
    @shape
    Join Date: 2010
    Post Count: 1,099
    March 31, 2011 - 12:52 pm

    Cashbond – pretty much a standard Bond…but there are many different types.-

    Learnings- Yes cashbond are fine…but it depends which type of cashbond you hold and is it an Australian cashbond ?
    Just a few points;

    1. ” upto 20k private finance “?? so are you getting a loan for a private fund for the subdivision??? – why dont you just borrow it from the bank your wanting to apply this 2nd IP

    2. Your situation sounds a bit complex to solve correctly over a forum- you have a lot of “variables” and “unknown” happening.

    3. Your back up plan will only work if this is an ACTIVE ABN for 2 years + you have a accountants letter as declaration ( highly unlikely any accountant will supply this letter) OR an Business active statement from the ATO ( unlikely) OR 6 month trading statements ( Unlikely)

    I guess what im trying to get at is …your best to go for a full doc PAYG application because on your bank statements the lender will see regular “income” from your work and this will cause alarm bells…*ding ding ding * game over buddy.

    4. GF – no chance for serviceability guarantor…can only be a co-borrower.

    5. ” duck and weave between lenders to get it accepted. ” – Your playing a dangerous game, a lot of lenders will automatically shut you out if the purpose is for construction.

    My advice as an broker- be upfront…yes we can be creative in the way we structure your loan, choose your lender, choose the product..but at the end of the day if you have to resort of serviceability guarantor, Private funds, cashbond and Low-doc self employed JUST to get this loan over the line….is it really worth it???

    So i say, sit down with your broker and accountant and work something out- you never know it’s probably not as bad as you think.
    I clearly remember a client who came to us 15 month ago and requested a private non-conforming lender outright ( rate of 14% !!!!) because she thought her situation was to complex for the banks and she was close to settlement.. We end up placing the loan to CBA and it was approved within 2 weeks.

    You never know if you never ask. Guessing and presuming is a dangerous game and can cost your thousands.

    Regards
    Michael

    Mick C | Shape Home Loans
    http://www.shapehomeloans.com.au/
    Email Me | Phone Me

    Same Banks. Better Rates. Served With a Passion.

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