I was trying to do this in Victoria and had to have another contract drawn up. In the end I never went thru with it.

You also must get finance arranged just in case they don’t settle (for whatever reason) on the same day. If the vendor give a notice to recind, you will only have 14 days to settle, and this is not enought time for a bank to do…[Read more]

Hi Jas

The agency has tracked down the tenants mother and she won’t give out his address, but has said he collects mail from there. So the have sent letters asking him to pay etc. Now they have asked me to pay $450 so they can serve a summons on him. This money would be tacked onto the amount he owes me and the would also recover this from him. I…[Read more]

Smoke

It depend on when you signed the contract. If it is more than 12 to 18 months ago, then yes you can get a loan based on valuation with a standard bank at standard rates. And this is with LMI approval.

If it is a shorter settlement, then you can still do it, but rates will be higher as we will have to go to smaller lenders or private…[Read more]

Plenty mate. Try units in Campbelltown or Cabramatta. prices start around $140,000. late last year I went to an auction in Maquarie fields -ex housing commisison 3 br house went for $150,000. Aound the blacktown area you can get houses for about $200K still.

Terryw
terryw@froggy.com.au

Leigh

A good example would be if you had sold a property and had a capital gain. Depending on the size of the gain and the size of your other loans, pre paying hte interest could wipe out paying any tax on the capital gain.

Terryw
terryw@froggy.com.au

Fullout

Yes you will have to pay stamp duty and CGT on land.

You can try and sell the land you have purchased before settlement, but I don’t know about the deposit. If you are using a real estate agent, you won’t be able to get the new buyers deposit until settlement as it must go into their trust account. I don’t know what happens if you are…[Read more]

JellyB

That happens sometimes. Bank (or LMI) is worried about having too many units in the one block. It increases their risk. Maybe there are other units in the block with the same bank as well?

You could just ask for an increase in your loan, take out the extra funds and go to a different bank using those funds as deposit.

That’s a good…[Read more]

Polaris

If you go for the cheaper end, you could go very far using your your own money, then getting a large deposit from the wrapee which replaces most of your deposit. You keep saving in the meantime to help you go a bit further.

Mathew, no offence taken. I too have heard that it is not legal to do installment contracts using IO loans. But I…[Read more]

here is another angle on Options.

A client of mine bought a rental property about 2 years ago for $228K. A developer has purchased an option for this property with a strike price of $1mil. Epxiring in one year. He has options on a number of houses in a row, and has submitted DA approvals etc to council for some big units for the site. This…[Read more]

I agree with Willi

I do 5 years leases with an option to purchase anytime – the strike price is set at 20% more than market price and this decreases like a PI loan (tho more slowly)(I now think this may be too generous). I get a option fee upfront of $3000 to $4000 and get about 40% more rent than market value. This generates a good +ve cashflow…[Read more]

Polaris

You would be mainly marketing to people who can not qualify for bank finance.

I can see the potential of Sandwich lease options!

Terryw
terryw@froggy.com.au

Matthew

I think wrap is a broad term referring to both. At first I couldn’t understand why some people called LOs wraps as well. I don’t think you will find ‘wrap’ used on any legal documents. I think ‘Installment Contract’ or ‘Vendor Terms contract’ would be more accurate for what you refer to as wrap.

Terryw
terryw@froggy.com.au

Polaris

I think I understand what you are saying? Sometimes these things are difficult to explain in words!

The person selling an option on their property is, I beleive, not doing it because they want to sell it quickly. it will be actually slower than if they just sold it outright. I think they would be doing it because they wanted a higher…[Read more]

Yep. Anything related to the earning of income. Computer, Internet connection (for research etc), study courses, books, street directory, travel to see property or for study or to see accountant etc. Virtually everything!

Terryw
terryw@froggy.com.au

Gerard

Mezz is risky and the rates are usually only 15 to 20%. You could make more by investing this in deposits for wraps!

Terryw
terryw@froggy.com.au

Matthew

it is not illegal to wrap using a IO loan. It maybe with an installment contract, but you can certainly do it using a Lease Option. And it can be structured to work just like an installment.

Terryw
terryw@froggy.com.au

Fullout

CRAA is your credit reference file (i forget what the letters stand for).

You should get a copy of your own file just to see what’s on it. This is what the banks check, every time you apply for credit there will be a record. And any default etc will be listed.

see http://www.baycorp.com.au , You can get a copy for free.

Terryw
terryw@froggy.com.au

Fullout

If your loan has been submited you will have an inquiry on your CRAA. Not such a bad thing as you could explain it, but still another enquiry!

Have you considered ING, 5 year fixed at 6.29%. Interest Only up to 95% LVR. this is a cheap rate. reverts to standar rate after 5 years. The average 5 year fixed rate is about 6.44% at…[Read more]

Kirby

I am a ortgage broker and had this problem today with a valuation (diff bank). I rang the valuer and talked to him about it. He is going to amend the valuation because the owners had figures for comparable sales to prove he was way off (about 20% off).

This happens occaisionally. Banks are not at fault, it is the valuer that is being…[Read more]

Hi Bluebear

That strategy can work. The interest on the money borrowed to live on won’t be claimable, but it can still work. You could withdraw about 80% of the growth of each property per year. eg a $500,000 property grows 10% in year 1, you withdraw $40,000. Year 2, it grows another 10%, you borrow another $40K or so.

It works well if you have…[Read more]