Hello all,
I want to get into prop. Investing but am so confused where to start. So many seminars, wrap this and negative gear that. P&I verses interest only. Talk about analyses overload!
Here is my situation: I am 26, have travelled for the past 4 years and only have about 12k in the bank. I don’t own a home therefor have no equity which, from what i’ve heared is the way to get into RI. I have a good job now but no work history over the past 4 years in Aus so getting a loan will be impossible I gather.
I like the sound of Steve’s wrap pack and would invest in his product but as I say I am just not sure what I could do without either equity or tax returns for the past 4 years. Is it impossible for me to get started now? How can I find out my best options? Any advice would be much appreciated.
Regards,
Matt – Sydney.Hi Harry,
I found myself in a worse situation to yours. Had a good job, but absolutely zero cash in the bank and lots of debt, including a car loan that was more than what my car was worth!!
Thanks to my mortgage broker mate, I went and borrowed money from one of those “Non-conforming” lenders, because none of the banks wanted to know me. They were great. They lent me 110% of the purchase price, which, together with the FHOG, allowed me to pay for my IP (which I’ve lived in to renovate, and still haven’t moved out yet!), and didn’t charge any mortgage insurance.
Of course, nothing is for free, and there was a price to pay – interest at 8.5%, an up-front fee of 1% of the loan (which was still cheaper than mortgage insurance) no option for a fixed rate, and I had to pay off 15% of the loan on a 5 year term (the remaining 95% was a normal 25 year term). This meant a bit more pain in the beginning, with larger than normal mortgage payments.
But the benefit of it all is that I got to buy a property and renovate it, when it would otherwise have been impossible for me to do so. I’ve recently refinanced my loan with one of the big banks on a much lower interest rate, and can breathe a sigh of relief.
This might not necessarily be the method for you, but I just wanted you to know that it isn’t impossible to get a place of your own now, although there may be a price to pay for it.
Cheers
MThis loan is offerred by Liberty finance (www.libfin.com.au). There are a few conditions that a borrower needs to meet (mostly to do with stable employment). It might be worth considering.
Cheers
Stu
Property & Finance News
at http://www.prosolution.com.auSt George will also do 100% finance and the interest rate is 6.90% variable (the loan is the same as their standard variable rate loan with all the features just slightly higher application fee and interest rate).
You need to have 2.5% that is held by the bank plus purchases costs and at least 12 months employment. So your $12k you might be able to get you into something without paying too much for it.
If all else fails then try Liberty finance. Nothing wrong with the product just the rate.
Regards
Davo70
Be aware Harry
If the loan is for residential investment – St George will require minimum income of $50K and minimum net assets of $175k.
If for OO – then these won’t apply.[
]Josie
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