Bill

Yes you can do it legally. There are basically 2 ways.

1) cross securitise you existing property with the new. When you sell the exisiting one, the lender will need to revalue the remaining one. If it has gone up in value and the remaining laon will be 90% of its value or less, then ok.

2) Withdraw equity from the existing loan (eg redraw, LOC etc) and use this as deposit for teh new one. When you sell the existing property you would have to repay this money as the security will not remain. So you may have to get the new one revalued as above, or find the money elsewhere.

Terryw
Discover Home Loans
North Sydney
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Chris

You will have to pay stamp duty on this, as well as legal fees. Also bear in mind that you will have to charge yourself market rent, and therefore after a number of years the rent will exceed the interest and the trust will be making a profit. Depending on who you distribute to, extra tax may be payable where otherwise you wouldn’t. Also you lose your PPOR CGT exemption.

SO carefully weigh up all the positives and the negatives before you do this. It may still be worth it?

Terryw
Discover Home Loans
North Sydney
[email protected]

Somebanks will take annuities into account wehn assessing your income. The trouble is you have to be able to borrow to buy the annuity in the first place. You might as well use low doc loan instead.

And SIS, I think you have mixed it up. You pay the lender a sum initially and they give it back to you monthly plus interest.

The theory goes something like this:
You have $500,000 worth of borrowable equity, you borrow this and buy a $500,000 annuity over say 5 years. You will be repaid $100,000 per year plus interest, so maybe $105,000 per year. Some lenders will accept this whole amount as income – even tho it is mostly just your own money.

Terryw
Discover Home Loans
North Sydney
[email protected]

One of my tenants is currently 4 weeks behind, and I am in the process of evicting them (Vic).

I would get your PM to get onto them if they are more than 2 days late. Once they go over 14 days send them a Notice to vacate, and get your PM to go to court (VCAT in Victoria) to get a possession order. Then if they do leave the police can be authorised to kick the tenants out.

A good source of information are the various tenants unions in each state. They have websites and explain, from a tenants perspective, the process of being evicted including what a landlord can and can’t do. The tenants union Victoria can be found at:
http://www.tuv.org.au/vacate.htm

Terryw
Discover Home Loans
North Sydney
[email protected]

SB

I used Westpac recently for some of my properties. It cost me around $400 per property and I think they gave me a multiple property discount of around 10%. This covers building and malicious damage etc by tenant. There is also cover for loss of rent if the property is unrentable for a certain period.

I don’t think you would need contents insurance as this is covers the tenants personal items and should be their responsibility.

Someone in another post gave this address for an online comparison of various companies:
http://www.insurancewatch.com.au/home.htm

It is worth a look.

Terryw
Discover Home Loans
North Sydney
[email protected]

I am not sure what exactly you mean by assigning contracts. If you are meaning to sign and/or nominee and then substitute the purchaser for a fee, then I can’t see how there could be any question of ethics!? (BTW, this can’t be done in every state without paying double stamp duty)

Terryw
Discover Home Loans
North Sydney
[email protected]

Mel, that is my understanding and experience too. (I tried to post earlier but couldn’t due to that flodd control thingy)

Terryw
Discover Home Loans
North Sydney
[email protected]

John. Here is a good site regarding depreciation by a quantity surveyor:
http://www.washingtonbrown.com.au/site/depreciation.cfm

Terryw
Discover Home Loans
North Sydney
[email protected]

As Mortgage Hunter said, each bank has different criteria which is not always very trasparent. Brokers have access to banks excel spreadsheet calculators, but unfortunately we cannot give these out.

As a guide, Most banks take 100% of income, 80% of rental income into account, and then a living allowance which varies depending on how many dependents you have, your curretn repayments for exisiting loans and then the repayemnts on the loan you are applying for at an interest rate of about 1.5% above current rates. They may also make this calculation PI even if you are paying IO. And they will take 3% of your credit card limits as a monthly expense-whether you pay them over every month or not.

Terryw
Discover Home Loans
North Sydney
[email protected]

Yes I purchased it a few years ago. It works ok, but does take a bit of effort entering all the data. I didn’t find any mmistakes on mine, but didn’t end up checking all properties because it takes so long to enter.

The trouble is you need a special code to operate it, and if you re-install it you have to fax away for a new code. I reformated my computer, and just never got around to asking for a new code.

Terryw
Discover Home Loans
North Sydney
[email protected]