Forum Replies Created
I’m not talking about large companies, a lot of which have been around for a long time. I’m not talking about the companies that provide for the infrastructure of our economy, and I’m not talking about international companies that operate in Australia.
The inference was that we are talking about individuals going into business. I learnt at university that four out of five new business’s fail, there was also some question over the profitability of those that succeeded. And I’ve seen these statistics replicated in real life through observation.
I’m not making a rash generalization here, just pointing out that most small business’s fail, and that’s largely due to the fact that a lot of people don’t have the acumen to succeed, or the personal characteristics to get the acumen in the beginning.
I’m not saying that business doesn’t drive our economy. I’m sorry but you’d be assuming I was completely ignorant if you thought I didn’t know what a bluddy economy consisted of!???
Liz
Mortgage Lender
1300 780 826HB Well my biggest concern is how do you suppose that in your first scenario Mitchy comes up with 100k for plant and equipment???
Commercial loans require 25% deposit, for a premises… if you propose someone is eligible for a 100k business loan could you please tell me how to acquire such a loan as I have a lot of interested clients? (seriously, I’m not being condescending, you obviously have a knack for starting out with nothing)
Look, I’m not against going into business, I hope one day that I could be like you HB… at 23 I created my own company and took a big risk going into business for myself, with something I am passionate about. I’ve been successful, however for the first year and a half I had to work 2 other jobs to pay for the costs it takes to get clients, I am very PRO-entrepreneurist!! I doubt I work 38 hours a week these days and have a great income affording me what I want, but I am lucky. I had a very down to earth mother, and a father who encouraged my business acumen. I was also born with certain talents that were fostered, I have a degree under my belt, and am thankful for everything that has ever happened to me…
You see, I look at my friends and acquantinces, and I’ve seen their misguided efforts at starting their own business, they either have an ability they are trying to sell, or simply came up with a plan one night and started a business… I’ve seen them fail and go into debt. They had no business acumen, they didn’t have a degree in marketing or work experience in the field they went into. Bottom line is, they didn’t know how to make their business PROFIT. There is nothing wrong with the product, they just don’t know how to market themselves, or bother putting money into marketing themselves. I’m not surprised why so many business’s fail, you have to play it so safe, by getting the knowledge and always setting goals, you have to be somebody that NEVER gives up. But a lot of people YOUNG OR OLD just don’t get it, they want a quick buck or they want to do what they love regardless of whether it makes a profit.
That is why I have to agree with property investing. If you do a bit of research, it doesn’t take much to make a lot of money.. in the LONG run especially. Being a mortgage broker I know how much easier it is for everyone, but I have the full respect of the banks underlying ‘risk factors’ and understand in more detail why some investments or higher gearing is a risk.
I’m not saying anyone in this forum is right, or wrong, the knowledge adds value, but I’m deeply opposed to one right solution for everybody. I do however think PI’ing is a realistic way to get ahead, in most cases the bank will require you to have an adequate deposit OR prove genuine savings (the ability to make repayments) to cover their risk, which in turn covers your own backside.
It is true, only a few succeed at business, and only a few really succeed, and that comes down to possibly a combination of luck, but largely, business acumen, and let me tell you, some people will probably never have that, or are quite happy to be employees.
I guess for someone who went into business for themselves is offering a conservative opinion, but that is how I’ve run my business. I’ve never used much credit, and paid to establish myself from working 70+ hour weeks, and let me tell you, it was hard, but also rewarding.
The best advice I can give anybody starting out is to get the knowledge, don’t look for quick answers, investigate, READ, LEARN be OPEN to opportunities that take EFFORT but always push your boundaries and LEARN work HARD. If you go down any avenue with these principles in place, you will have a much much larger chance of success.
Liz
Mortgage Lender
1300 780 826My thoughts exactly Mitchy…[wink2]
Liz
Mortgage Lender
1300 780 826Gee HB – HARSH![angry2]
Ok you have a point, and let me start by saying to Mitchy that in my professional opinion, you are talking about extending your own home LVR to 95%, then buying another investment at 95%, most banks will get a little jumpy about this, unless you can show VERY good servicing ability (income/incomings) you are going to have trouble.
You are overextending yourself and unless you are both very secure in your jobs and budgeting and have a tonne of research I wouldn’t consider it. If you did, perhaps leave the equity in your home and opt for a 100% product, but only if you feel like the rental and capital growth are worth it.
However, there is a big lesson to be learned for a lot of young guns out there, …save save save!!!
HB, yes you have a valid point, but as someone from the X generation I would like to acknowledge that yes I do believe that it is taking these generations longer to grow up, but not ALL of them. However I do believe there are valid REASONS behind what is going on in our society?? Do you think these children were BORN with the notion that they could have everything now??
People in my age bracket are very conscious of the need to get into property to establish themselves securely, ie. mitchy, is obviously trying to set herself up for family, her long term security. If she did go into further debt would she not be working her bumb off to pay it off??? We’d hope so, or she’d learn a quick lesson like the other statistics you quote.
In the meantime, if your daughter wants everything now, perhaps you might ask yourself whether you really blame yourself, as a mother, for her misgivings, or society in general, for it’s consumer based engine driving this economy…??[eh] And probably a tonne of other factors….
Anyway I’ll get back to WORK because frankly, most people in my generation know that we work the LONGEST hours of any generation. The statistics are all there….
Liz
Mortgage Lender
1300 780 826There are a lot of new products on the market including 95% investment loans. 100% is available too however it comes at a premium interest rate although it’s usually worth considering if the capital growth will outweight the interest rate right?
Suzie Q a deposit bond will only cover you between exchange and settlement, the deposit still needs to come from somewhere at settlement time.
The costs would depend on what state you are in but I’d assume around $12k for NSW. A bit less for QLD. Where are you.
Also what is the loan value and the home value on your current property?
Liz
Mortgage Lender
1300 780 826Hi Cabo Wabo (love the name)…
But don’t you find it difficult to generalize this one boss and his actions, to a whole institution? And if so, perhaps you didn’t think that ALL banks put terrible amounts of pressure on personal bankers and lenders and tellers to perform?
I mean I used to work for a big bank, and I understand their hard nosed “sales” approach. For the record I completely disagree, I think sales should NEVER be pushy… but the thing is, most banks operate this way. It’s sad but true.
Havn’t you ever thought sales is the most stressful job?
My point is that despite hating the NAB, I think you should think more broadly. I sell their products through Homeside, and I am absolutely chuffed with what they have done for me.
For instance, Homeside allowed me to refinance a client from a lender charging 10%, because the client had defaults, we made a good case and they approved the deal. It was totally outside the square, and they looked at it. They are one of the only BIG banks that I’d consider to have a heart… They are one of the only lenders I’d respect.
Besides, if something is stressing you out, the best way to make a point of it is to leave, and tell nobody else to work there right? Take control of the situation so you are no longer a victim of it, then nobody has to hold lifelong meaningless (well to everybody else but you) grudges…
Liz
Mortgage Lender
1300 780 826L&S,
No, nobody I’ve asked has come up with anything better.
Recurring or mortgage stamp duties??? There is only upstamping to think of. I always warn clients in refinance situations of the full mortgage duty payable, as they are quite often out of pocket until the rebate from OSR comes. I can’t see how Mortgage Duty would leave a mortgage broker out of pocket.
The thing about this case is that it is straight forward, you have 100% loans investment, 100% securities investment.
Either way I’ve forced the point that the client needs to seek independent financial advice and that I am by no means a qualified accountant. As far as I’m concerned by liability ends there.
Everything else is pretty straight forward, calculating mortgage duty is pretty easy. You only pay mortgage duty on the portion of the loan increase.
Perhaps if you remember exactly what the issue is you could share it with us all. I cannot think what other implications there are.
Liz
Mortgage Lender
1300 780 826As it turns out, he didn’t seem to realise that ALL properties were investment, ALL loans were investment. Why this wasn’t blatantly obvious is beyond me still.
Never mind, the good news is, the customer comes to me, even though they have negotiated the rates with the bank already. Now that was a nice compliment!
Liz
Mortgage Lender
1300 780 826Well I have reverted to calling the employee lazy
and so have a few others, and that’s all opinion and could easily be considered slander.Besides, I don’t want to inflict negative connotations on an institution, which has thousands of representatives, not just the one that seems to have created the confusion. I’m certain that a more competent employee would not have made such a remark.
There is always an avenue to stand up to a large company, I am never afraid to take on a challenge.
Liz
Mortgage Lender
1300 780 826Tell me about it… I used to work in one. The morale is all time low, the turnover is high, tellers NEVER balance (and people say they prefer humans to ATM’s!!!) and nobody knows anything!!!
Don’t get me started on why I became a broker… in a nutshell, can’t stand the banks and their antiquated ways…
Liz
Mortgage Lender
1300 780 826Well it was a lending advisor at one of the major banks branches but I’m never too keen to slander anybody in public forum!
I think it was more a personal issue rather then an institutional one. As you’ve all implicated yourselves, my first assumption also, was that he was lazy, but I don’t like jumping to conclusions wihtout second or third opinions!
Thanks for the feedback all of you.
Liz
Mortgage Lender
1300 780 826Well now my suspicions are confirmed….
Liz
Mortgage Lender
1300 780 826Ha ha, THANKS Richard, this is what I was too afraid to say, surely there can be no implication!!
I think it’s an excuse not to do the paperwork… I’ll do it for him anyway…
Merry Christmas
Liz
Mortgage Lender
1300 780 826Hi Guys,
Thanks so much for your help!
Much appreciated Steve PM received.
This place is so resourceful, I’ll let you know how I get on…
Liz
Mortgage Lender
1300 780 826OK I have the new Heritage rate. 3 years 6.89% very flexible product too…
Liz
Mortgage Lender
1300 780 826Yeah me too Stu…
Usually all of the ‘creating’ comes from the clients!
How do you propose to cover your own living costs + a mortgage if a bank only considers 75% of rental income?
I think what people are implying is you might need a larger deposit so that you qualify for a ‘lo doc’ product, meaning a self-declaration of an income… which you probably don’t have.
Liz
Mortgage Lender
1300 780 826You don’t really have any equity in the land. Depending on your postcode, and I’m guessing by property price you are rural, you may be able to borrow up to 90% of your current property, so an additional 65k in your home loan, and then get a further construction loan for the land. You would need to access the 65k or thereabouts in your house to leverage the LVR down.
As for construction loans what is the postcode, the construction cost, and what do you plan to build?
I would not suggest a line of credit, your current loans are not going to benefit from it for any reason. Remember a line of credit is a vehicle for a specific purpose, not construction, unless you want to keep leveraging the money out again – do you? Lines of credit come at a higher rate so ask yourself, is it necessary?
Liz
Mortgage Lender
1300 780 826Yeah pretty standard stuff, take it out if you want to access it in the next year. Remember break costs are payable in fixed rates if you want to get out of them. It’s no surprise to us brokers the one year rate is lower then a 3 year, as fixed rates are indicative of what the longer term market will be doing.
Heritage building society offer extremely flexible fixed rates and have no rate locking fees. Their fixed rates go up tommorrow though…
Liz
Mortgage Lender
1300 780 826Hi Damian,
Anything over $1,000 is going to be hard to push through. What LVR are you seeking?
You really don’t have much chance if it is unpaid, however you are saying it does not relate to you. I would be contesting it asap and keeping all documentation, you could provide that to the bank to prove that you are actively trying to pursue it and get it fixed.
Test the waters, see what the bank says if you say its not yours but you’ll pay it if it means getting the loan.
You should engage a broker to do it for you, a broker would be able to fight for your cause and pull as many strings as he/she can.
I don’t know how people do it on their own anymore…
Goodluck though,
Liz
Mortgage Lender
1300 780 826Or alternatively if you do not want to declare an income you could try a NO doc option up to 65% lvr. You just need to have an ABN for at least a day…
Liz
Mortgage Lender
1300 780 826
