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My company has its own 100% lend product. the interest rate is 6.45%, and some of the condition are;
Owner occupied only
max $300,000 lend
No units in buildings greater than 4 stories
no defaults
need 12 months of continuous employment
need 3% genuine savings
The LMI fee is 2.6% (!)
etcAs you can see it is very tough to qualify, as the risk is much higher. beats the Pepper product though.
Terryw
Discover Home Loans
North Sydney
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
To get certain low doc loans (ie good ones), you must be self employed (for 2 to 3 years). The way banks check on this is to do a search and find when your ABN number was registered. So it may be an idea to register now just in case…..
Terryw
Discover Home Loans
North Sydney
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Hi Insider
I agree.These loans will appear on your personal CRAA (just ask anyone who has a loan thru a trust).
You would be required to tell a bank about any personal guarrantees.
Terryw
Discover Home Loans
North Sydney
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Another way, is You could borrow the 20% deposit from elsewhere (friends etc). That is the only way really.
BTW on the 100% lends out there the mortgage insurance is about 2.6% of the loan amount!
Terryw
Discover Home Loans
North Sydney
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
That sounds very strange and therefore I suspect it to be wrong. Can’t think of any reason why it would be correct.
Terryw
Discover Home Loans
North Sydney
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
If your PPOR isn’t paid off, then put you cash off that loan, and then get a LOC (or just a loan with redraw) on your home. Use this money as deposits for loans with a different bank.
Terryw
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
You could buy 4 properties for wrapping and make approx $16,000 passive income per year.
But you would have to pay tax on this, and then pay for your rent with after tax dollars. So maybe not a good idea after all. Depends on your circumstances.
Terryw
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
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Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
You can claim anything that is an expense related to your current earnings. If you have not IP you technically cannot claim it, but can it relate to your current job in anyway? You don’t need a business name either.
Terryw
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
6% return is very poor compared to average properties returning about 4%. Factor in the higher management costs, lower capital gains, and the difficulty obtaining finance and on-selling. I don’t think it is worth the risk!
Terryw
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
That table didn’t paste very well.
The figures for High growth property are:
10% capital 5% rental return Growth on property value
Year 1 $330,000 $16,500
Year 5 $483,153 $24,158
Year 10 $778,123 $38,906
Year 15 $1,253,174 $62,659
Year 20 $2,018,250 $100,913The figures for cashflow property are:
5% capital 10% rental return
Growth on property value
$315,000 $31,500
$382,884 $38,288
$488,668 $48,867
$623,678 $62,368
$795,989 $79,599Terryw
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Vluu
It is not hard to get aloan without a job, but it is hard to get a GOOD loan! I would get an ABN number now, so that you could get a good low doc loan. Some of these need 2 years self employment history, which they prove by the date of ABN registration.
You could use the $300,000 as security if it was a term deposit. But why? You could just use this a deposits and borrow the rest.
Terryw
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Hi
I consider a proeprty to be positive cashflow when the income exceeds all expenses. Positive geared is when it might be negatively geared but then positve after depreciation and tax benefits are counted.
Any property can be made cashflow positive by wrapping it. doens’t matter where it is.
You could also change a negative cashlfow into positive by converting a room into antoher bedroom for example or renting each room out separately to students (for example).
Terryw
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
One of our clients is doing this at the moment. it is working really well for him nad has left him with 2 unencumbered properties. he hasn’t finished yet and will be very Rich when he does.
As long as you have a good margin in there you will not max out.
Terryw
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
The best way to find out what a property will rent for is to ring up some agents and pretend you want to rent a similar property and see what the going rates are. If you ask the agent while you are looking at the property to buy, she/he is likely to exaggerate a little.
Terryw
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Nu Gen
The banks will still be able to get you whatever structure you use as they require personal guarrantees from directors and/or trustees.
Freeby
The best way to minimise tax is to minimise your earning. ie by paying for things with pre-tax dollars. eg. that holiday to the goldcoast, it was really a trip to inspect one of your properties, the internet is for buisness purpsoes etc. Have a look a Dale Gatherum Goss’s “Trust Magic” for some ideas on this.
Terryw
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
I don’t have that much experience with deposit bonds, but was told by one company that they do a CRAA check. However, I have had a bond myself and no check appeared on my CRAA.
usually with loan pre-approvals the bank will check your CRAA. It is one of the first things some banks do. But with some you can request a pre approval subject to CRAA check. You can actually get a deposit bond without a pre-approval, the bond company assesses you on your ability to get a loan.
There are many deposit bond companies in Australia, only a few underwriters. Most banks can issue them now.
Terryw
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
This is a common problem after you get a few properties. CBA is like this.
I would suggest trying a different lender, maybe using a low doc. But if you are 80% LVR, things are pretty tight. You will geernally need 20% deposits with low docs. Do you have other funds available?
Another suggestion is to write to you bank and ask for a payout figure for all of your loans. They may then give you what you want!
Terryw
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Thank you fellow brokers!
Terryw
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Mary
A Trsut will cost about $1000 to set up. All you have to pay after that is the tax return which should not be any more complicated than for an individual. Say $100 per year. Well worth it I think.
Terryw
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Hi Chris
I only know of one good financial planner that is property focused, and he has just retired (early 30s). There are very few financial planners that know about property or recomend property, fewer still would know about wraps. Maybe you could see a solicitor to get an idea of the process and a wrap contract. Check out http://www.businesslawyer.com.au for one in Sydney (cost about $500?). An accountant like Bruce Whitting can talk to you and give you some advice on wrapping and structures etc. His company ahs a home page at http://www.mintgroup.com.au and a consultation would be about $200 per hour.
Other than that just read this forum. You will learn a lot and it is free!
Terryw
[email protected]Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
