Ah yes, cross collateralisation. My topic. I knew I’d ruffle a few feathers. Yes yes yes. Stand by my claim that you can settle a deal with no supporting paperwork through relationship management Chanels – customers can even get their docs printed while they wait at the first appointment – if rp data vL stacks up. – Like to see you try and settle…[Read more]

Cba do 95% plus lmi to a max of 97% total: if you’ve had a credit facility for more than 6 months with good conduct. Credit card is the easiest qualifier – even if you havnt used it …

Must be owner occupied transaction – investment is 90%

You don’t need to let your property now for a record of the income. If you let it at the time you just give the bank a copy of the lease.

We knew what you meant

Yes Richard – using someone in the uk is far cheaper in this example. Just explaining how it works, the critera and cost to expect to do it in oz. Gives readers the ability to strike a line through the Aussie option – and understand why it’s not viable.

Worth pointing out for a larger client with trade relationships already establised (preferably…[Read more]

Worth pointing out that the 80% restriction for personal investment relates to 'not property' transactions. E.g. if purpose is selected as 'purchase an investment property' then you are fine at 90% plus LMI.CBA still has no cash out policy for lines of credit at 80% and lends 95% plus LMI for existing customers buying owner occupied properties.…[Read more]

Terryw wrote:
1. Tax benefits depend on the use of the property and not the security.

The property is the security. I think he means the purpose of funds e.g. if the purpose of the property is investment – and the purpose of funds in personal – the later is the more important.

NAB or ANZ; private / business banking. One lender takes the security and issues a standby LC (bank to bank guarantee) in favor of the other bank. e.g. bank in UK takes the property as security and guarantees the Australia bank.The bank in Australia then has the guarantee as security. This is often as good as a Term Deposit. If the standby LC and…[Read more]

JAY BURSLE wrote:
There are two blocks of 8, with minimal work required up front, but plenty of opportunity to improve (little bit shoddy looking).  And all the units are titled, so opportunity to sell off individually in the future if needed.

Hi Jay – most comments above are due to people thinking they are on one title. You could split the…[Read more]

I know you guys are not keen on majors but I just approved a deal, did rp data Val and printed contracts within 2 hours. If you can’t get a deal done with Westpac or Cba wihin 7 days you don’t have the right contact.

Terryw,Your spot on with regard to a couple of the downsides – When a client is going bust, has properties reducing in value and cannot service their debt, the bank has more control if crossed. This is why I say to keep the owner occupied out of the mix and to manage which properties you cross and don’t cross. Read the security schedules. Do…[Read more]

quote=Terryw Hi BankerAll valid points thank you. But what about the major downsides of CC?such as1) bank may have more security than needed    If you move security around it is the same amount of security offered. Just to different lenders.2) bank may have a choice on which property to repossess    Not if you don’t cross everythi…[Read more]

Qlds007 wrote:
To throw in my 6 pence worth i actually phoned the local branch of each of the big 5 banks this morning to be told:1) 4 out of the 5 told me that a formal application would still be required and I would need to come in with my income.     Even as a customer i would need to verify income especially being self employed or emp…[Read more]

Terryw wrote:
As to bankers points.1. I am not sure why CC would save you proving your incomes??? If this would apply to CC why not to stand alone?

Standalone is fine. If your bank has history of your deposits in their account this is sufficient income verification – all 4 majors.

Terryw wrote:
2. Having 10 loans as opposed to one loan would…[Read more]

Depends – nab business bankers can go to 90% but you need to have some form of commercial interests to get a business banker. Westpac and Cba can do 85% but it is pretty rare – need to be an existing client with in a strong position. You will struggle at branch level. I have no idea about what non banks offer – am a born again non-bank virgin

Is this one lender or two?
Can you provide interest rates?

It’s hard to say if you should restructure. If cashflow is tight make sure rates are as low as possible and switch peronal debt to IO only (keep in mind you can still reduce an IO loan if you want by increasing your repayment).

You could always role the LOCs into the loans – might be…[Read more]

Just a quick point – it does not matter if the loans are split between one bank or two – property 2 value is insufficient to support the total debt.

You have 2 options;

1: restructure all debt to be secured against property 1 (get the title back for property 2)
2: have both properties supporting the debt (as you do now)

If you choose option 2…[Read more]

Banks are still lending if the developers have experience, a strong balance sheet and plenty of equity. Pre-sales required in almost all instances. If your a first time developer you should cut you teeth on something a little smaller to start with.

Lots of people lose money on these deals

Mark – Terry has a point re offset has benefits. My point above and I think Terry’s is that one glove dosnt fit all people and it depends on future goals amongst many other things.

Another thing no one has touched on is servicing. Some banks will assess deals on a 30 year term. If you apply for 5 years IO then 25 years PI banks will often assess…[Read more]

Nice come back number 8 however not everyone wants to keep buying. Everyone has different goals. Once you’ve paid down personal debt their is nothing wrong with amortising investment loans.