I had a chat with my mortgage broker, and I think you are correct, hence we changed our strategy. At this moment, we will be looking for something around $500K, the holding costs will still be significant, however with proper research and planning, it should make business sense. 

$750K is spending on IP. There are two in mind, first one is a house, with 700m2 land but I don't think I can subdivide it, great location and renovated already. The second one is actually $800K, with 1100m2 of land, and great potential of subdivision, as ample land in the front of the current residence, and it is about 450m2. I should…[Read more]

We checked few properties, and there's one in particular stood out, it is $750K. If we want the finance to be organised ASAP, when is the earliest it will be ready? 

At $750K, that we will rent it out, and the deposit comes from the current PPOR loan set up as a separate loan, how is our borrowing power?

I will try to talk to a mortgage…[Read more]

Thanks for your advice. Not to overcomplicate matter, we plan to buy another PPOR in 5 years time (consideration is that when we have a primary school kid). Current PPOR will become an IP, same with new IP. My question is this will change any of your advice.

We are bit worried whether we can get loan for future PPOR, because we are…[Read more]

That is a good advice indeed. Why you did not recommend using cash? One of the reasons that we want to buy an IP is because we don't want our money lying around in term deposit or even offset (my wife does not like offset, I know it is not smart).

When applying for a new loan, will they calculate projected rent income as a…[Read more]

I have saving up to 10% of the IP price, I have atm is $50K and I can get up to $75K if I have to. Some properties in my mind are typically units and 2 bedders, with price around $500K. Hence, say it, I have deposit for 10%-15%.

Current PPOR is valued at $625K easily, and loan $375K – hence equity: $250K.

It will be joint…[Read more]

For an IP, which one is more beneficial? 

Another question is, if my PPOR loan is currently on 2 year fixed and now 10 months to go, if I want to take some money out of it to fund more deposit (if  second…[Read more]

I just fixed mine for 1 year, for 5.99% with Homeside. Feel free to join. I am not sure about 2-3 years, but I have done my calculation, the chance is very slim for my current variable rate (6.55%) to beat the fixed rate. From the gesture made by ANZ to lower fixed and raise variable, it seems that they hope people will fix their rate,…[Read more]

But may…[Read more]

I am considering to fix the rates only for a year. Of course, it is everyone’s common sense to think that RBA will drop interest rates. But the question are: how quick? when? will the bank pass it in full (if RBA cut too often)?

Well it is just my thought. As what I mentioned before, I learned two things from last RBA cut. First, it…[Read more]

I believe there should be a paperwork in regard to the calculation, you should ask your accountant. FYI, to calculate a refund, it needs few things to determine:
1. Assessable Income which includes the share of property losses, capital gain and employment salary. AI
2. Total Allowable Deduction ( most of them work related, and as well the…[Read more]

Hi Terry

Many thanks for your reply. I still couldn’t understand, if it doesn’t cost me even one dollar, I can go back to SVR – 0.70% + Offset A/C in a year time, I will repay the principal (which is same thing as your suggestion), why…[Read more]

1. Fixed rate does not offer the offset account- so your offset account will become void once you go fix.
2. Your expecting a massive bonus- in which you can NOT place into the mortgage/offset if i turned into a fix product. – if anything go half half….planning ahead is…[Read more]

I am sorry Richard to…[Read more]

I am back… with same old problem hahaha.. four months have passed now, and I am enjoying a lot the house, slightly further than where I lived before, but transports are great, so not really a big deal.

My experience is very difficult to maintain motivation with offset account, especially when Christmas is coming. I previously forecasted…[Read more]

Owh, he didn't even issue an invoice with term of payment, he direct debited from the bank's available fund for settlement.

I agree with you Terryw, what I was saying is:

http://binvested.com.au/how-to-build-a-10-property-portfolio-in-3-5-years-realistically-on-50000pa/

Nathan Birch himself of…[Read more]

Some banks will only allow a Max of 2 equity release per year; after your 2nd one they will start to ask a LOT of questions and it does get harder.

Regards
Michael

So from what I understood…[Read more]

Hi Michael,

When usually you really need to cross collateralise your property? Is it the case when you paid off your PPOR mortgage, and need money to invest ?

Shape wrote:
Regarding rent; most lenders will only…[Read more]

I’ts a good thing that the bank has placed your valuation price the same as your purchase price- it means that the valuation was either:
1. HIGHER then the purchase price- alwasy a good thing ( they alwasy take the lower of the 2)
2. The difference in valuation + – was less or more then 5%

I think I know the reason, it is…[Read more]

Not yet married…and im very asian ahha

No wonder, I hope my parents live here

Shape wrote:
When the time comes for a PPOR, i will transfer all offset account $$ into the PPOR no question ask- partner/wife can complain as much as she wants ( i guess im going to have to buy a MASSSSSIVE rock to silence…[Read more]

I just realised though, with loan split for IPs like that, that means it is almost impossible to achieve positive CF, because you have to pay the principal as well on the half of the loan, means your repayment will be quite significant. So when you actually look for a property for an IP, you have to disregard the principal component for…[Read more]

Haha, I think I need to meet you Mike, when it is about the time for me to create more wealth. That sounds a good idea, that means you can have more IPs whilst also you clearly know you are getting more equities in your properties.

I don’t 100% understand, but I got the idea. That split, must be 50:50 ?

Michael, you know that my…[Read more]

What you were saying is if I buy IPs and make it IO, don’t use an offset account attached to it ?

If say it I get it topped up, and free up 30k and…[Read more]

But I still have a question, is the IO structure and offset account still good if I get the property revalued, top up the loan, and free up some equities to buy IP somewhere else ? That means I will have another loan (90% LVR probably), original loan will be getting bigger and untouched balance in the offset account (in case the…[Read more]

Now I am waiting for the settlement. The tenant has indicated to be able to move out on 13th, and settlement can take place on 15th. That means 4 days later than original expected settlement date, which I am fine.

For the time being, I am thinking about what will happen in the next 2-3 years. My loan structure is Interest Only for 5…[Read more]

I understand now what…[Read more]

Vendor needs to give 30 days notice to tenant, it is binding or not ?

I am actually really frustrated with my current place I am living. One bedroom for one couple to live (12 sqm). And…[Read more]

So if the property is not vacant till September, I have to wait the settlement till September?

So not sure if it’s worth the hassle JUST to bring settlement 7 days forward.

In case, after 11/08, tenant won’t move out, what can I do, mate? My…[Read more]

I don’t sign any contract with the tenant and that property is legally mine, if settlement took place, that means if he insists to live there, I assume, it works like someone lives in your house without your approval. So I guess as a reasonable person, should I call police?

My solicitor mentioned before if the tenant couldn’t find a…[Read more]

I want to ask a question, the scheduled settlement date is 11/08 and I really want to settle early, say it 04/08, even though there is still tenant living there, I don’t really care, I don’t mind to pay interest from 04/08 to 11//08. Is it possible to do that? The sale contract said it will be vacant at the settlement date, so I assume from…[Read more]

I am currently with REST. Does that mean I have to rollover to a new super fund that can accommodate those insurance ? I do not know actually how it works technically. With REST, if I can recall, they also offer insurance, maybe I just need to increase the cover amount.

Ferdinand

Your personal information
Date of birth: 1984
Gender: Male
Medical conditions: None
Income: 57500
Household debt: 430000
Have you smoked in the last 12 months?: No
Have you ever been declined life insurance?: No

My only concern now is to ask my solicitor to organise a building report which can take upto 3 days. But I asked him to find a way to get it done tomorrow, which I don’t know he can do it or not, still waiting a call from him. That…[Read more]

Thanks for replying

There was no problem with the loan. Tomorrow, my broker said, bank will give unconditional approval. Bank also values the property as very low risk property.

I read the sale contract again and all the descriptions from the council, nothing is worrying. Not affected by any hazard risk. My solicitor…[Read more]

2. My solicitor said will do the title search later near settlement day, is it normal? When…[Read more]

It is different solicitor, his full fee is $1,200. For me saving $450 at this point is very important as my money drained for the deposit. And most of the FHOG is to pay Stamp Duty on the property. I appreciate Michael’s swift response as I only emailed him yesterday afternoon, hence feeling not that good but IMO, the word “ditch” is…[Read more]

Sorry to inform you, that I likely to accept an offer from a solicitor who will charge me $750 fixed fee all inclusive if I use mortgage broker he refers. I apologise if you have done some works. I hope I still can ask some questions if I am unsure about smth.

Regards,

Ferdinand

If I am going to ABC Lawyers doing conveyancing service for me, should I expect better service than if I go to ABC Conveyancer ?

$990 all inclusive, is it fair price for a conveyancer charge?