Fergus,

In response to your questions, my thoughts are:

Qn 1: As much as you can get, bearing in mind your wealth strategy and also the relationship you have with your lender. In our case, we knew that paying off debt increases our cashflow and as such we were happy with a 20% deposit. This does detract from the available cash though.

Qn 2:…[Read more]

Mark,

Re: the long settlement… we asked for it!

We will be doing an 80% lend on this deal, which is our standard finance terms that allows us to continue to borrow money.

In this case, the lender that we are using is the NAB.

Can I ask who you have sourced at 80%?

Thanks,

Steve McKnight

Tara,

Three comments:

1. Know the difference between fact and opinion. Fact: interest rates are at 30 years lows. Opinion – how long they will stay there.

2. Good deals exist in all markets. Rising interest rates will kill some deals, but you can still buy today and lock in rates for five to ten years.

3. Accept the market will never be…[Read more]

Hi,

When I worte this post I did so as a case study.

Prior to starting the post I had signed a contract to buy it for $50,000 on a six month settlement, subject to (a) finance and (b) a builder’s report to my satisfaction.

Well, finance wasn’t a problem, however as the case study mentioned the building report came back with a problem with the…[Read more]

Hi,

You ask:

if u currently have a mortgage and wrap it to someone else…do u find it hard to get financing for another property and another seeing as that the banks will think u are exteding too far wont they ? and want u too pay put the loans first b4 getting the second and third ??

There is a problem if you buy it in your own name as you…[Read more]

Rob,

Vic & NSW: immediate
Tas. & Qld: After 12 months
SA: Wraps illegal
WA:?????

Regards,

Steve McKnight

Hi,

Of the 40 or so wraps that we did 3 three years ago, 50% have now terminated as either moving out (and we have resold, re-wraped) or they have cashed us out.

This large atrition rate is primarily due to our poor classification and qualifying techniques over potential clients – something that took time to fix but which is working better…[Read more]

Tara,

My advice is to check the council zoning for the property as a guide to what lenders will use as the basis for classification.

I know that anything zoned rural comes with alarm bells from a financiers point of view.

As a general rule:

Residential: 80% LVR (higher with mortgage ins. or other security)
Commercial: 80% – 70% LVR
Industrial…[Read more]

Hi Dianne,

Firstly, I think that the information provided by the replies you have received all contain good advice.

To be honest, it is difficult for me to comment on your deal beyond very basic indicators. But sometimes these are best because they tend to cut through all the hype and emotion associated with the ‘sell’.

If you haven’t already…[Read more]

Hi Eric,

Thanks for your excellent post and for your helpful comments.

You raise the point about properties in the La Trobe valley and I thought that I share my experience about this area since this is where a number of our investment properties are too.

Dave and I began investing in the La Trobe valley in early 2000 – just before the FHOG came…[Read more]

Hi,

One of the many things outlined in my Wrap Library is the treatment of Land Tax (in Vic.)

Basically, if you know what you are doing you can avoid having to pay it at all. The solution has nothing to do with asset structuring – just about knowing the SRO system and how to use it to your advantage.

Regards,

Steve McKnight

Hi,

I understand that Greg Levett is sourcing a lot of wrap loans through GE under a full disclosure basis… but I welcome both Darren’s and Greg’s confirmation of this.

Regards,

Steve McKnight

Felicity,

I like JM’s simple yet effective ad. Given your target market I recommend you place it in the ‘TO LET’ section. Put a border around it so it stands out a little.

For more specific advice I recommend you consult the ‘Classified Ad Secrets CD’ I produced a while ago and which is part of the wrap library (which I think you have…[Read more]

Hi,

A possible contact to try is Charles Gluck (mortgage broker)on (03) 9852 9188.

Regards,

Steve McKnight

Hi,

I think the biggest distinction with the strategies is that you can qualify for the FHOG with a wrap but not a lease-option.

I regard both strategies as very useful tools that have slightly different application depending on the exit strategy of the investor and the needs of the client.

For example, for clients that do not qualify for the…[Read more]

Felicity,

What did your ad say?

Replicate it here using headlines, bold etc. and I’ll read it and provide some feedback if possible.

Bye

Steve McKnight

Hi,

This may not be the advice you are after at this point, but I feel compelled to say that I wouldn’t[/b[ be investing in property (or anything else) until you first addressed the issue of why you are broke in the first place.

No amount of money will be able to solve a money problem if you alwys spend 101%+ of what you earn.

Investing has…[Read more]

Hi Andrew,

As I pointed out in the Wrap Library, I think that the best way to manage the risk with your client is to complete a very thorough qualification of their ability to repay.

Follow the advice I outline in the ‘Vendor Finance All Wrapped Up Module’ and also on the PATTERN Templates (Tenant Application).

You can help yourself in…[Read more]

Peter,

In your case it may be best to team up with someone looking to make a quick dollar and say to them that if they source a deal and you buy it then you’ll offer $$$$$.

This is known as ‘bird-dogging’.

Feel free to make this kind of offer here on the forum – provided you spell out the exact nature of your offer and your specifications for…[Read more]

Hi,

A lot of research for the data that you require certainly can be completed over the Internet.

If you are in Vic. / NSW, then I encourage you to read the articles posted on 19 Apr. 2002 as these contain a lot of great info. These reports come out 1/4ly.

Most of the information that you require is available through the ABS too. You’ll need…[Read more]