Sorry i thought i had done the calculation in my previous post.Total Loan required = $293K + $309K + 12K = $614,000  Total valuations = $425K + $309K = $734,000$614,000 /  $734,000 = 84%.

To be honest i am slightly unsure as to what you are referring to.I have never come across any lender that applies a buffer as you have described.Simply if the lvr (which is the new loan as a percentage of the new valuation) is over 80% then you will incur mortgage insurance.On your figures loan seems to be at 84% so LMI would be incurred but in…[Read more]

DarrenWelcome to the world of development, time and expenditure blow outs, higher interest rates, cost increases the list goes on and on.To add to this i assume you have factored in GST and CGT on your sale.In essense you are wanting to obtain short term development funding at residential interest rates.

Not sure which State you are buying the block in but at those figures it certainly isnt Qld.There are not costs for Mortgage registration / Transfer or discharge and not sure who your loan broker but he is kidding himself if he things the deal would be done at 10% especially on lodoc and DEF fees of 1K per unit is ridiculous.You would add in…[Read more]

I am with Terry whilst the deal maybe doable with a cash inject from your friend the question would be whether it makes financial sense.Max lvr is likely to be circa 65% of GR and if you are unable to support the loan the interest rate will be around the 13% Terry has indicated.If it can be financed you have to ask yourself is it worth.

JasYes with a decent equity injection from your friend then a gross realisation loan maybe possible.Mainly these lenders want to see either some previous experience or pre-sales or at least the deal well covered by security.Subject to the numbers interest capitalisation could be possible but the rate of interest and set up costs wont be cheap.We…[Read more]

Hate to say this a US website and there are considerable differences between the 2 countries when it comes to financing.Even terminology is different so would suggest you give the Professor a wide berth or you will be even more confused.

As Terry has mentioned a Business Plan wont even get you past first base.Most loans are credit scored and if you fail the credit score then everything else is meaningless.It is more about knowing the in and out works of the lender and their requirements when it comes to a combination of Credit Score / UMI ands DSR.

Also depending on the State in which you are in you might want to think of buying the first place as your primary residence claiming both the First Home Owners Grant and the Concessional Stamp Duty.Once you have satisfied the elligibility conditions you could move out.Structure the loan as interest only from day 1 and you should be fine.

llonkaIf you have equity in the home then you could always look at a shared equity loan through a major bank.

Hi JessI can do a WA one for you if you would like.

I think you might find this varies from State to State so i would probably check with the Residential Tenancy Authority in your State.In Qld the Vendor could certainly issue a Notice to Leave as the property is under Contract (assuming of course the tenancy is under a periodic lease agreement)

No shouldnt be an issues at all.This is a structure we normally recommend to our clients so that they release the reliance on the PPOR as quickly as possible and shoft the debt burden to the individual IP's as soon as equity and increased valuation allows.

Very easy to avoid cross collateralising the 2 securities and that is to use a separate lender for the new IP loan.As terry has mentioned set up the LOC on your existing PPOR to fund the deposit and acqusition costs and then take the majority of the loan on the new Ip.Also if you are focusing on positive cash flow why not consider buying the new…[Read more]

Sorry Jac M this is totally illegal the super fund is a business and would have to charge rent to reside in the property.A SMSF cannot rent out a residential property to any related party under the SISA.Penalties for breach of the Act are severe.

llonkaHow are you going to do this ? If you sell a part share then whoever you sell the property to will need to join on any loan / mortgage agreement that you currently have. As an investor with cash that doesnt sound like a great proposition to me.

Definately negotiate the price first because otherwise you may well end spending money on a B & P and find that you offer and the vendor accepted price are miles apart.Also whilst you are waiting for your report to come back to you you may well end up find that the Vendor has accepted another offer.

Also the number of lenders offering construction finance for a SMSF deal are few and far between.You wont get a SMSF lend on land alone.

Rock i think is unlimited and they were offering 1% of the SVR until recently.

John just to qualify the point you made in that case the parents are not guarantors but now borrowers.Also neither of the mortgage insurers will accept a 80% lodoc loan where the 20% deposit has been borrowed or gifted.