Re the 20% loan. CBA and Westpac will both do these on a second mortgae: same price and interest as a first mortgage; albeit a deed of priorty is required. Terry is correct re you can just get them to lend you the fund. Either way works.

Terryw wrote:
Guarantors don't have any effect on you claiming anything. So you should be able to claim the interest on the whole loan amount (if the property is rented out).You parents will be givening an equity guarantee, so you will still have to demonstrate to the bank that you can service the whole amount to be borrowed. They will also have…[Read more]

You could also borrow 80% against the purchase property. Followed by a loan for 20% against your parents property. The 20% can be in your name however will need a guarantee from your parents (as it is secured against their house or IP).

As both loans are in your name you will get all tax benefits / or any gov grants.

By doing it this way then…[Read more]

Nice to have your post followed by a promotional advertisement.

I missed the part in the first post saying that it was for an existing property. Rather than getting a new loan they should be able to complete a variation (switch) from your current loan to a fixed loan (assuming current loan is variable). This should only take a few days. As Richard said; you cant just pay 12 months worth of payments into the…[Read more]

You don’t have long to find a property if you want to prepay Interest this financial year.

Approx 7 days to go if you buy with a 30 day settlement…

I agree with Richard:- the deal is too small to be asking for presales. Shop around.

Interest only for the life of the loan?

You can already get this on a line of credit… Most interest only loans allow you to roll into another interest only term when the interest only period is up… What’s the diff?

Sorry to say it but there won’t be real competition to the banks until long term wholesale funding costs come down, until then…[Read more]

Just because you can doesn’t mean it’s a good idea. Everyones circustances are different:-

There is nothing wrong with big loans for clients that have strong and secure cash flow. Loans of any amount can become a problem if you have trouble servicing them.

Hi Richteddy,

max loan with LMI is higher; depending on the lender.. I dont know the max but in some case up to approx 1.5m is OK however It would be very expensive and hard to ge approved.

If you revalue in the future and borrow 80% you won’t need to pay LMI again.

If you borrow 600k at 90% today with a major bank you can go back to them in a…[Read more]

To add to my post above; If you take 5 years interest only up front debt servicing is calculated over 25 years. This is because they need to ensure you have capacity to repay after the IO period if it converts to PI. Hence the variation option allows you to borrow more.

jacqui_03 wrote:
Yeah Richard I know most Banks will calculate IO as P&I however im basing it on a lender which will use a 30 yr term on normal SVR loans where they will only use 25 year term on LOC's.  Do you and Terryw agree on not cross collaterising securities?

With the 0.1% added on to the rate for LOC and 25 year debt servicing it smel…[Read more]

I just thought I’d put some input in to this one. I’ve just finished a property in melb. 1.5 years. 500k purchase. 700k sale. After taking out stamps and costs I’ll make 150k with no tax – l lived in the house so havnt included interst as a holding cost ( have to live somewhere).

I’m now looking to do this again however with one important factor:…[Read more]

I would buy a broker industry magazine or similar and go for someone with some industry recongnition e.g. Has won some awards or similar.

I don’t know the exact stats however the average broker in Australia settles less than 700k per month. Let’s say 2-3 deals. Although the industry is tightening up there are still a lot of cowboys that struggle…[Read more]

Qlds007 wrote:
Strange that you have to find the right manager of the CBA to get the deal done as surely if lending to an applicant with 1 months casual employment  is Bank policy you should be ok anywhere you go.

Policy is not as black and white as some non bank lenders. There is no minimum term for employment under 80%.

Re getting a good b…[Read more]

CBA at 80%. As long as you get a good manager you should be fine. Assuming servicing in OK. What state are you in?

Not saying you don’t Richard-: point being most brokers struggle with business / commercial deals let alone reading a P+L or balance sheet.

Qlds007 wrote:
Really just did a 6 pack of non strata brick units thru CBA only last week.

yes but I said broker / retail. Even if this is broker introduced it would have gone commercial / business banking (even if done on a home loan product). Most brokers are not commercially accredited and most that are don’t know how to package a commercial deal.

I wouldn’t go the low doc option as you are obviously not self employed: – if you get an ABN and provide a fake income declaration you might be OK but if it goes bad you’ve committed fraud.

CBA will do it at 80% if you’ve worked on the same industry, it wi helpif your previous financial year income was similar:

what sort of work do you do?
What…[Read more]

I don’t know exactly how hey manage their capital however they are owned and funded by Westpac. That does not mean Westpac won’t sell them in the future:- they are still run as seperate businesses.