If there is not growth, then you do not borrow any money to live on. You only can increase your loans at a portion of the growth. you would also only do this strategy with high growth property.

If your properties are continuously growing, then you will have equity. If you have enough equity, you can always get loans.

Steve Navra is another who advocates living off equity. His strategy is slightly different to the investors club. There are a few articles on his website http://www.navra.com.au

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
[email protected]

I have to agree, with everybody, the information is out there if you want to look – for free.

But, if you buy a pack which helps you make many thousands of $$$ then it may be worth it.

I wonder how many people who buy these packs actually go out and use them.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
[email protected]

I am not sure this would be correct. I think anyone can advise on property even without qualifications.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
[email protected]

I beleive it is a sound practice if done properly.

One idea promoted by the investors club is to buy seven properties, one per year for seven years. In year 8, the first proeprty would be worth approximately double what you paid for it.

You then take some funds out of this by increasing the loan. The funds can be used to live on or to supplement income. Some of the funds can also be used to be the extra interest incurred.

In year 9, you then access the funds in property 2.
In year 10, property 3, and so on….

at the end of the cycle, you go back to property one, and it has doubled again so you can take out more funds.

Sounds good in theory, and it can work in practice if you are only taking a small amount of any growth. Having at least 7 properties will help in this regard.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
[email protected]

Hi

I am actually suing a person at the moment, in NSW.

Once you have a court judgement against a person, you can do a number of things including:
– Obtaining a writ of execution and sending the sheriff around to seize personal property which can be sold
– Garnish their wages. A certain amount must be left for living expenses, and then the rest can be taken
– Examination summons. They can be ordered into court to give a listing of their assets ans liablities and income etc
– obtain a writ against land, to force the sale

If they still don’t pay up, then the creditor can file a notice of bankruptcy. If they do not comply within 21 days, they can then be bankrupted.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
[email protected]

That’s a bit complicated and something you should run by your accountant. Before you do, have a quick read up on the benefits of a discretionary trust – instead of a company.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
[email protected]

Thanks Brahms. I did mean the MSE, which can basically be used like a LOC.

There are other low docs available, probably ANZ would be good if you needed a low doc LOC at around 6.82%. But it will not fit everyone.

Rob, what is that Low Doc at 6.76% you are talking about?

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
[email protected]

I beleive the CGT will flow through to the beneficiaries. So if it is a person that receives the capital gain, they would receive the discount. Whereas if the gain went to a company, then it would not.

ps. I am not an accountant

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
[email protected]

Any money not spent on paying interest on investment loans could then be diverted to the person’s home loan, paying it off sooner.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
[email protected]

Do you have to get a loan? That is the slow bit.

Terryw
Discover Home Loans
Mortgage Broker
North Sydney
[email protected]