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I prefer to listen to people who get their facts at least reasonably right before they go spouting off opinions to the media.
I also prefer to listen to people who contribute in a positive manner to discussions to improve a situation, rather than just issuing all encompassing tirades about it.
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Felicity
It would probably help if you mentioned which city you’re talking about…..
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FelicitySounds very similar to some of the ideas Robert Kiyosaki brought up in his book, I think it was called “Prophecy”.
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FelicityYou could try http://www.avibe.com.au
They do disclosed wrap finance.Keep smiling
FelicityFrom the link posted above…..
Rick, How Does ‘We Buy Houses’
Secure My Funds?· We do this a number of ways
1. Firstly, we keep the title of the house in our name until our applicants sell or refinance and pay us and you out.
2. Second we don’t create more than 80% debt on the property, so for example a house of $300,000 has no more than $240,000 attached debt.
3. Third we provide you with a Registered Consent Caveat, which is fully explained, in our Loan Agreement that you can download here for $45. (The $45 is refunded together with your first electronic interest payment.)
4. Fourth you are the only investor in the property as ‘We Buy Houses’ only permits one investor per property.
5. Fifth…In case I happen to fall over a balcony during property inspections… I always carry $3,000,000 in life assurance with AMP
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FelicityI tried to buy a house through a Jenman agent, it was impossible.
No listings to look at, a salesperson who averaged 2-3 days to return my calls… maybe that’s okay for your average home buyer, but as an investor it just wasted too much of my time.Keep smiling
FelicityMy first words of advice are usually to say – work out what your goals are, then determine what you can do with the money to get there.
It seems you already know what you want, ie your investments to fund your lifestyle.
So if it was me, I’d use the money to invest in positive cashflow properties to increase my non job income. I’ve personally used wraps to do that, but you may prefer “normal” cashflow positive property.
Wraps can be quite time intensive, so depending on your situation, it may even be worth investigating doing a JV with a wrapper, or even become a private lender to an investor, with rates of say 12-15%pa on your money for doing nothing.Keep smiling
FelicityDo a joint venture with someone who can set up cashflow positive deals (ie wraps) but has run out of borrowing capacity themselves.
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FelicityHope everything works out okay for you.
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FelicityI think you can do a lot of your research initially without necessarily viewing a property, but I’d certainly hesitate to actually buy without going there. Mainly because you can’t get a feel for the area without being there. Are there big power lines right behind the back fence? Bikies next door? etc etc These are things that can affect your ability to rent out the property (if that’s what you plan to do) and no amount of building inpsections will reveal them.
Having said all that, once you’re familiar with an area and have an agent there who you can trust, perhaps you could do it.Keep smiling
FelicityI use QuickBooks for managing my businesses, and I think it’s brilliant. I very rarely use journal entries unless I’ve paid cash for something.
However it took a while to get to that point. It’s a question of breaking down extensively into categories (or accounts as they’re called) – my chart or list of accounts is very long! But once they’re done, it’s very effective to use.
I still use Rick Otton’s cash creator spreadsheets to track my wrap buyer loans.Keep smiling
FelicityJPG
From a numbers perspective, no, there’s no reason why you can’t wrap units.
I think it does come back more to looking at your target market. Mostly people who want to buy my houses want just that, a house! I had one house on a subdivided block, and the number of people who lost interest once they found out it was subdivided was a very high percentage of the calls.
However I believe Rick Otton recommends lease optioning units, rather than wrapping. This probably makes sense, because people in units tend to be more transient, and therefore having a lease option would fit what they’re looking for.
I did eventually wrap the subdivided house, by the way, so it can be done. Took a while though!Keep smiling
FelicityThanks Rob, I always like to know what’s out there!
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FelicityRob
What LVR?
Is mortgage insurance payable?
Is it a full financial or low doc?
Do they lend to company/trust structures?Keep smiling
FelicityGrrr my ISP had a glitch and lost the really long answer I’d typed to this!
[angry2]
anyway, when I started out it’s fair to say hubby wasn’t keen. He was working ridiculous hours, and didn’t want to know. Initially I started doing some small share trades, and talking to him occasionally about it, but property was just too big a thing for him to contemplate. All he wanted was to pay off the house and no more borrowing.
Anyway, one day he read Rich Dad, Poor Dad by Robert Kiyosaki. It didn’t change him over night, but it certainly opened his eyes to a lot of things. Finally I convinced him to let me buy a rental property. We’ve moved on from there.
I have to say that even today a lot of what I do scares him, he’s not really comfortable with it all. But having said that, he took a package just over a year ago, spent last year studying full time in Children’s Ministry, and is now contemplating how best he can work to help primary school age kids at risk (and it doesn’t matter if it’s paid work or not).
He’s still not entirely comfortable with what I do, and still has a tendency to be a negative nellie when I come up with ideas, but considering where he’s come from, I think it’s brilliant!!!
I’m still the main investor, I still read the books and go to seminars by myself – I don’t know if that will ever change. His passion is helping kids, mine is investing. But at least he’s on the same page now. And he will bounce ideas around with me!
And right from the beginning, even when he didn’t want to know, he still reluctantly supported me.
So I guess what I’m saying is – take it one step at a time. It’s good to paint a rosy picture of the future, maybe even chuck in an incentive or two, but if you try to present the bigger picture right from the start in terms of how many houses you want, etc, you may just scare your partner so much that you’ll never get anywhere.
I started with little share parcels, then options trading, then one rental house, then two rental houses, then wrap houses, and so it goes.
The journey of a thousand miles starts with a single step – take your wife one step at a time, and you may be surprised.
But if she’s never interested in being your partner in investing, that’s okay too. All she really needs to do is not block you!Keep smiling
FelicityI’m in Victoria, Ella, so can’t help you with NSW.
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FelicityI guess the person who wrote the article has no idea what they’re talking about. Lease options are not illegal in SA. Perhaps the author should have worked out that wraps and lease options are two entirely different types of contract.
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FelicityJunkers
It depends on the loan you’re applying for, whether or not you get asked about the deposit.
My experience with lo doc loans is that financial institutions are a little bit keener to see evidence of the 20% coming out of the buyer’s pocket. This is probably because they’re handing over their 80% with very little concrete evidence of the buyer’s ability to pay, and therefore the 20% represents the buyer’s hurt money. If I have no hurt money in the deal, what’s to stop me getting fed up and walking away? Maybe even going bankrupt to get out of the deal?
I’m not saying I’D do these things, I’m just looking at it from the view of the financial institution.
And basically, that’s why they don’t like to see the vendor (or anyone else, for that matter!) financing the deposit.Keep smiling
FelicityDepending where you’re located, there may be an established group in your area already, that you could link into. A number of groups that started either at the Somersoft forum or NineMSN forum meet monthly in several capital cities.
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FelicityJust shows how important it is to comply with the UCCC.
I certainly have both myself and my husband registered as credit providers, and whenever I buy wrap properties in a structure I register the structure too. I’d rather go over the top that get in trouble!
It also shows the importance of using a knowledgeable lawyer when drawing up your contracts.Keep smiling
Felicity
