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Hi Nadaimee
Firstly welcome back and believe it or not you can get Professional advice on this forum also.
Accessing your equity and buying in your SMSF are 2 separate issues.
Insufficient hard data makes it difficult to provide you with some exact numbers but in essence i would look to work backwards.
Based on the fact that you are looking to acquire an IP i would look to raise 20% of the potential purchase price and acqusition costs of the IP by way of a separate sub loan secured against your PPOR.
Then look to obtain a standalone Interest only loan for the IP secured solely against the new security. This could be with a new lender to keep things nice and clean.
In saying this if you are looking a owner builder options you might be better off to look at an alternative structure and revisit the IP financing once the construction is complete as lenders are not lovers of OB's.
In regards to buying in a SMSF and accessing your Superannuation this can be done however bear in mind that you cannot occupy the property personally so buying a weekender is out of the question.
As i say difficult to comment with knowing the complete deal.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi Eraser
Yes not an ideal set up i must admit.
I think it would be a good idea to untangle the 2 loans and set up the IP deposit properly before you make the offer on the next property.
Sorry to hear you last experience of using a Mortgage Broker wasnt too good. Hate to say like any industry there are always going to be some bad apples but hopefully we are raising the standards by the day and a lot of the poorer ones have left or are on there way out.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Lizzie i dont like the sound that you are buying through a property investment company who are no doubt earning a sizeable commission from the sale.
Why dont you Contact someone like Andrew Allen from the forum who is a Buyers Agent and who specialises in the Brisbane area.
At least that way you will end up with a good value property in an excellent growth area.
Let me know if you need Andrews contact details.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Unless you rely on the interest from the savings place the funds in your offset account.
The interest you receive will need to be added to your Taxable income and will not aid your negative gearing position.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
I would never buy a Unit without doing a search on the BC records.
Who knows what forthcoming expenditure you might be up for.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Amazing that a representative of C & N just happens to pop up and post his / her first post when their firm is mentioned.
Have to disagree Lodoc in a Trust structure is readily available through a wide range of lenders and NCCP has certainly not put a end to this. Whilst the lending requirements by way of required documentation maybe appear slightly higher since the inception of NCCP any Broker worth his salt was undertaking such prudent checks and balances on his client pre-legislation.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Happens every day of the week.
In many cases we get a pre-approval done for the client and at the same time order a valuation with an assumed purchase price by an acceptable valuer.
The client then knows that as long as the property doesnt go for any more than that figure and the relevant risk ratings etc are all good he should be good to go.
Course if LMI is involved gets a little harder but not to say it is not achieveable.
Your Mortgage Broker should be able to guide you accordingly.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Reason i ask is we are seeing a few Off the Plan properties in Brisbane value in at less than the purchase price and havent seen that in years.
Few developers trying to lock in sales in order to get finance and yet the valuations are coming up short.
Personally i would be buying a property ready to go rather than OTP in the current finance climate.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
But as Michael mentioned probably better off to stay put as by the time the loan documents arrive the Westpac rate could be better than Anz.
Clients forget this is just temporary competition amongst the majors and when Credit Growth increases or they have the share of the market they want discounting will cease.
Dont chase a rate for rate sake as the correct stucture gets you there twice as quickly.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Precisely my point Terry and something we do for clients.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
You will have to take the LOC from your existing home lender.
I would then take the new IP loan with a separate lender.
Totally agree that the saving is marginal and if you get in deep with nowhere to go then you can't call for a spade to dig yourself out.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
I have to say if i was in Melbourne that night and knew Nigel was talking I would go along as you wont find anyone more knowledgeable on the US market.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
nnelg i would take Terry up on his offer.
Nigel you are so right managed to get away with it then and seems they are still at it.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
K & T
I still use the same formula today owning 40 IP's as i did when i purchased my first.
1. Can i finance it – in your case that appears to be YES.
2. Have i got the correct finance structure. Do i have my equity loan in place for the deposit and acquisiton costs so not to cross collateralise ther securities. (Your standard Finance clause will not allow for this so you need to have it done upfront)
3) What type of property do i want to buy. Cash flow positive / negative etc.
4) Given 3) above what entity should i buy in. Personal name / s (Joint Tenants / TIC) or DFT for income distribution and Asset protection.
5) Based on 2,3 & 4 above what will it cost me to hold the property.
6) Is this acceptable.You cant put the horse before the cart and expect it to work in the timeframe so you need preparation time.
Cheers
Yours in Finace
Richard Taylor | Australia's leading private lender
Hi Lizzie
With the Bowen Hills property is it an off the plan property or established.
1 bedroom is the total square metreage of the unit over 50 square metres ?
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Remember there is a reason why high yields look like a bargain.
Why not as Michael mentioned start small and invest in Oz to start with.
At least that way you will protect your parents equity.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
As Michael has mentioned on paper it sounds perfect and in some bases too good to be true but as is everything in life "if it sounds too good to be true then it probably is".
Anz will not alone in touching a PIT prepared by Chan & Naylor and I am suprised their Finance Dept did not tell you that … ah in saying that of course maybe you wouldn't have gone if they had.
Depending on the rest of the deal it maybe possible to finance it through a couple of lenders but your level of choice has just fallen about 95%.
Did a C & N Cnstruction loan for a Vic client recently and that was a struggle but we got there in the end.
Course C & N might offer you a full refund of the $3K + they charged you… on the othre hand they may not.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Yes his commission will be clawed back if you refi within the first 18 months and even after this period he will loose his trail.
Need to make sure that he doesnt charge you the equivalent amount by way of a fee if his commission is clawed back.
I still go back to what i have said so many times before that the interest rate is such a small part of the overall structure for an investor it is not funny.
Without hard data it is difficult to comment further.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
buck might want to be quick with the Anz deal as at this stage it is only valid until end of Nov.
Then it will be someone else turn to win a wee bit of business.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Mel in my opinion a Line of Credit is probably one of the worst structure sets up's for a PPOR loan there is.
What happens when the client decides to move out of the property and buy another PPOR and rent out ther current property?
Can he / she redraw the LOC and claim the interest ???? I think we both now the anwer to that one.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
