[Colin RiceParticipant@fmsJoin Date: 2011Post Count: 338]

October 14, 2016 - 2:36 pm

There is a good chance, I guess, that he did some mistake somewhere and only when the borrower will be ready to buy is when he will discover that he can’t borrow that much but I’m just wondering if there could be any other explanation that I’ve missed…

This ^^^^^ is the reason why I collect ALL the key metrics pre application so the advice given to clients is 100% accurate and they can proceed with confidence.

Unless the entire path ahead is clear, it may be prudent to do 2 year IO, thus having 28 years in the P&I calculations while still enjoying the IO term (it’s better than 25 years, not as good as 30 years)

There was a loophole with this at the CBA where you could go P&I for initial servicing and then call up post settlement and request a 5 year IO term. Not sure if this still exists as it seems to violate responsible lending?

• This reply was modified 7 years, 6 months ago by  Colin Rice.

Colin Rice | CDR Finance
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[Colin RiceParticipant@fmsJoin Date: 2011Post Count: 338]

October 14, 2016 - 2:27 pm

Get in touch with a broker from this forum if you want to build a multi property portfolio. No offence to the moderators who do an stellar job but these place are largely “self regulating” and if you are not excellent at what you do it doesn’t take long for people to find out.

Distance isn’t an issue as we would all have clients Auswide as well as some overseas.

Colin Rice | CDR Finance
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[Colin RiceParticipant@fmsJoin Date: 2011Post Count: 338]

October 14, 2016 - 2:22 pm

When considering apartments/townhouses/villas look for a plot ratio of 70/30 meaning there is a land to building ratio greater than 30% as its land that will appreciate in value over time and the building will depreciate over time.

Colin Rice | CDR Finance
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[Colin RiceParticipant@fmsJoin Date: 2011Post Count: 338]

October 14, 2016 - 2:08 pm

Has anyone had any experience with paying interest on mortgage a year in advance? Can you tell me how this went?

Its a legit strategy to reduce taxable income but a bit of cat and mouse as you are receiving a tax break in advance.

Colin Rice | CDR Finance
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[Colin RiceParticipant@fmsJoin Date: 2011Post Count: 338]

October 14, 2016 - 2:01 pm

Valuers report would reveal some pertinent info so get an upfront valuation done first. Will be free if resi via a broker but could cost a few k commercial.

Colin Rice | CDR Finance
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October 14, 2016 - 1:57 pm

Just came across this one;

“The best investment you can make is in yourself.” – Warren Buffett

Colin Rice | CDR Finance
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[Colin RiceParticipant@fmsJoin Date: 2011Post Count: 338]

September 20, 2016 - 11:34 pm

I agree with Corey, its a full time commitment and some, especially when starting out.

You will need to do a lot of networking and marketing to get clients and this can be done on a a budget and will likely be that way regardless.

A good book I listened to via audible.com a few years back was called “Duct Tape Marketing” which is about clever marketing on a budget.

You will need at least 12 months in savings as you wont start earning money until the pipeline is full and that assuming you are doing everything right.

You also need to be able to sell yourself with out being salesy as people are buying into you first as you will be driving the deal or project managing the whole process, or you should be.

This business is a combination of excellent advice, solving problems, managing people and expectations, dealing with high pressure situations and the day to day running of a business and all that comes with it.

Not for the fainthearted but if you plan and prepare well financially and roll with the punched you can do well.

Colin Rice | CDR Finance
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[Colin RiceParticipant@fmsJoin Date: 2011Post Count: 338]

September 14, 2016 - 10:31 pm

Read a great one the other day and went something like this;

“Investing in property is correct finance structuring with a house in the middle”

Colin Rice | CDR Finance
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[Colin RiceParticipant@fmsJoin Date: 2011Post Count: 338]

September 14, 2016 - 10:26 pm

@qlds007 would be interested in learning more about your private lending options Richard. Have sent you a PM and an email.

Colin Rice | CDR Finance
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September 14, 2016 - 10:13 pm

Searching via maps is also a handy tool especially if looking for development sites.

Colin Rice | CDR Finance
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September 14, 2016 - 9:56 pm

1. They will check that your PPOR has sizable equity before wanting your business. This is so the excess equity in your PPOR can make up for an over-valued IP that they want to sell you. Of course, any salesperson might quiz you to see if you have “Deposit and Costs available” – either in Equity or savings. Those with bad intentions want to see EXCESS Equity !!

That ^^^^^ is a classic and they cross collaterlise your PPOR with the IP and “hide” the val shortfall on the new IP in order to gouge the commissions. Hence the importance of stand alone finance structures.

Its a form of legalised theft and banks, brokers and property spruikers are all in bed together.

Not saying Reventon do this as I dont know enough to comment.

Colin Rice | CDR Finance
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September 14, 2016 - 12:23 am

More and more are coming on-board. ANZ kicked it off and now Westpac, St George and others are joining in.

Colin Rice | CDR Finance
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September 12, 2016 - 12:36 am

If it’s a yes, how should we arrange 2nd mortgage.

You would need to talk to an investment savvy mortgage broker to map out a suitable finance structure. If done wrong it could cause some pain.

As @benny has already mentioned you would want to do your research (or pay a professional to do it) so you understand the current dynamics and how this will effect the future value of the land you are considering purchasing.

• This reply was modified 7 years, 7 months ago by  Colin Rice.

Colin Rice | CDR Finance
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September 7, 2016 - 8:09 pm

@jaydenwalter you can link an offset to your PPOR and store / build up as much cash as possible and use the funds to debt recycle when required.

Debt recycling is converting non deductable debt to deductable debt by paying down the PPOR debt and reborowing and placing new lending in a separate loan split.

Colin Rice | CDR Finance
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September 7, 2016 - 6:14 pm

[/quote]would love to do that! The loan only came out at $260,000 maybe the banks are starting to hold back their lending.[/quote]

It could be that you have hit the serviceability or may need to make sure you have exhausted all options with other lenders. Your broker may have missed something?

• This reply was modified 7 years, 7 months ago by  Colin Rice.

Colin Rice | CDR Finance
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[Colin RiceParticipant@fmsJoin Date: 2011Post Count: 338]

September 7, 2016 - 3:01 pm

I attended a seminar back in 2000 and the speaker said;

“Its a great time to buy property in Perth. Buy what you can afford. If its a bedsit, buy that, if its a 1 bedroom flat, buy that, if its a 2 bedder buy that, if a 3 x 1 buy that” and so on

The point was work out what you can afford and go and buy it!

What really got me interested is when I bought a PPOR house and land package and did as much work as I could on the house. We sold 2 years later and doubled our money and walked away with 250k.

Although we got lucky and timed a 2 year growth cycle it made me realise that you can really make a lot of money if you get it right. You can loose a lot if you get it wrong as well.

I can trace back from my current position today and give credit to that deal that allowed me to do what I do today.

Colin Rice | CDR Finance
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September 7, 2016 - 2:50 pm

San wrote:

I will be taking a separate loan for IP(may be from a diff bank) to keep IP and home loan separate.

This is a sound strategy as you are not keeping all your securities with the one bank.

As already addressed get a “top up” but make sure it is in a separate loan split to keep PPOR debt and IP debt separate for tax and accounting purposes.

Colin Rice | CDR Finance
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September 7, 2016 - 2:43 pm

If you do use another broker be upfront and offer to pay for the service.

Nothing worse than some one milking you for info with no intentions of engaging your services when you could be spending the time and resources on some one who is genuine.

• This reply was modified 7 years, 7 months ago by  Colin Rice.

Colin Rice | CDR Finance
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September 7, 2016 - 2:28 pm

Bank staff compound the problem by telling people that offset and redraw are the same, clearly they are not.

An offset used correctly can be a powerful yet simple strategy that is typically not used to its full potential.

Colin Rice | CDR Finance
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September 7, 2016 - 1:52 pm

@panina any reason you cant put in a 10% deposit as opposed to an 20% deposit. Yes you will cop some LMI but you will have held back some of your capital that can be placed in a offset account for the next purchase and/or a buffer.

• This reply was modified 7 years, 7 months ago by  Colin Rice.

Colin Rice | CDR Finance
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