to those who say there’s no opportunities

Thanks Richmond for the words of encouragement,
it sounded as if you were talking directly to me []
Cheers,
Sue

“Be careful not to step on the flowers when you’re reaching for the stars”

Hi Richmond,

Where ? ANy in Sydney ?

M

Richmond, read my post literally and that is what I am talking about.

No ifs no buts, no hidden meanings, no stabs at you, I am merely saying that I am able to sell properties in say the Blacktown, Rooty Hill, Seven Hills etc area on only a few thousand dollars deposit to the right kind of person (i.e. someone who is able to service the loan.

It may not suit everyone and one does have to determine whether such a purchase is or is not suitable or profitable for one’s paticular circumstances.

Pisces133

Hi,

Properties for sale…??? Are they positive cashflow – if so, on what basis?

An initial deposit of only a few thousand isn’t anything hugely special.

Perhaps outline more information and in the interests of discussion there may be quasi-advertising, but so be it.

Bye,

Steve McKnight

**********
Remember that success comes from doing things differently.
**********

Spider, what happened ? What did you intend to say in your post ?

As it is you are only quoting without providing your comment !?

Pisces133

The way I see it, option A (the vendor assisting by lending part of the deposit) appears infinitely better to me than option B because I am very debtphobic.

That is partly because of my age and partly because of some unhappy experiences whereby I got caught (on more than one occasion) with loans whilst (because of the economic climate) not being able to find buyers.

I can see however that option B may well be preferred by some others who are centring on pocketing the difference in interest paid and interest received.

There are some black marks against Option B.
the way I see it.

For example,a few vacancies all at the one time AND being unable to fill the properties quickly with new tenants may put one under pressure (and may well bring the deck of cards come thundering down).

Yeh, I know that having access to some cash elsewhere would act as insurance but (I would think that) many people haven’t got that (when they start out) and , for them, progressing a bit slower may be the key.

Another drawback is that the more money we owe the harder it gets to get the next loan because of perceived inability to service from the bank’s point of view.

A low Doc type of loan may overcome that problem, though at a cost.

Pisces133

quote:

---

The way I see it, option A (the vendor assisting by lending part of the deposit) appears infinitely better to me than option B because I am very debtphobic.

That is partly because of my age and partly because of some unhappy experiences whereby I got caught (on more than one occasion) with loans whilst (because of the economic climate) not being able to find buyers.

Hi Picies,
Option 1 sounds good to me Let’s see if I got this right.
House contract at $ 250,000
I can get 80% from bank = $200,000
Does that mean in the contract the deposit paid shows as $ 50,000 Is there a clause in the contract to say there is vendor finance?or do you have seperate document with the vendor only.
My experience is banks don’t like vendor finance in contracts

Please let me know, either here or email me at [email protected]
Thanks Smiley

I can see however that option B may well be preferred by some others who are centring on pocketing the difference in interest paid and interest received.

There are some black marks against Option B.
the way I see it.

For example,a few vacancies all at the one time AND being unable to fill the properties quickly with new tenants may put one under pressure (and may well bring the deck of cards come thundering down).

Yeh, I know that having access to some cash elsewhere would act as insurance but (I would think that) many people haven’t got that (when they start out) and , for them, progressing a bit slower may be the key.

Another drawback is that the more money we owe the harder it gets to get the next loan because of perceived inability to service from the bank’s point of view.

A low Doc type of loan may overcome that problem, though at a cost.

Pisces133

---

quote:

---

The way I see it, option A (the vendor assisting by lending part of the deposit) appears infinitely better to me than option B because I am very debtphobic.

That is partly because of my age and partly because of some unhappy experiences whereby I got caught (on more than one occasion) with loans whilst (because of the economic climate) not being able to find buyers.

Hi Picies,
Option 1 sounds good to me Let’s see if I got this right.
House contract at $ 250,000
I can get 80% from bank = $200,000
Does that mean in the contract the deposit paid shows as $ 50,000 Is there a clause in the contract to say there is vendor finance?or do you have seperate document with the vendor only.
My experience is banks don’t like vendor finance in contracts

Please let me know, either here or email me at [email protected]
Thanks Smiley

I can see however that option B may well be preferred by some others who are centring on pocketing the difference in interest paid and interest received.

There are some black marks against Option B.
the way I see it.

For example,a few vacancies all at the one time AND being unable to fill the properties quickly with new tenants may put one under pressure (and may well bring the deck of cards come thundering down).

Yeh, I know that having access to some cash elsewhere would act as insurance but (I would think that) many people haven’t got that (when they start out) and , for them, progressing a bit slower may be the key.

Another drawback is that the more money we owe the harder it gets to get the next loan because of perceived inability to service from the bank’s point of view.

A low Doc type of loan may overcome that problem, though at a cost.

Pisces133

---

>>Option 1 sounds good to me Let’s see if I got this right.
House contract at $ 250,000
I can get 80% from bank = $200,000<<

If the buyer hasn’t been able to save some money in the past which would enable him to put up some of the deposit at least, then it is a pretty safe bet that you would be looking for problems by selling to such a person.

So, using your example I would be looking for someone who can come up with anywhere between
$ 3,000 to $ 10,000 cash + who also would be eligle for a FHOG. (government grant of $ 7,000 )

This would make a total of between $ 10 K to
$ 17 K which would be available and in such a case I would not be unhappy to lend him the balance of the 20% deposit (provided this would come out of my profits so I wouldn’t be digging into my own cash money.

Secondly, the contract of Sale wouldn’t mention anything about a vendor’s mortgage as the lender may not be happy about this at all. The second mortgage document would be signed but not be registered on the title. Lodge however a caveat on the title.

I want to mention however that a lot of solicitors nowadays would, for security reasons, advise their clients against an unregistered second mortgage.

The way it has been explained to me is that a caveat in effect doesn’t give an equitable interest in the title.

This means that the first mortgagee could conceivably increase the loan amount and this would therefore eat up the equity in the property
which you are counting on for security.

Until recently I thought that a caveat would provide a proper protection for an unregistered mortgagee. That no longer appears to be the case.i

I don’t know the exact details, I guess that there must have been a recent courtcase relating to this.

In any event as my loan comes out of my profits anyway I personally would be prepared to take that risk.

Please note however that if your purchaser has the income to service a loan greater than 80% you may be able to obtain such greater loan for the buyer. (though this does mean that the buyer will be up for a, once only, mortgage insurance premium however).

pisces133

Hi all
Im new to the game.I live in Adelaide and have been told by a buyers advocate that we shouldnt buy in Adelaide.1/the property prices are over inflated at the moment 2/the pop growth here is going no where.What do u all think of this.

We have flown to cairns and bought 2 investment properties there which after reading steve’s excellent book are not cashflow possitive like we thought they were. They fall under the c income negative/cashflow positive.WE own our home outright and have used the equity to buy the properties.So if you factor this in as well Im probably worse off.So if anyone has any ideas how I can turn these around please tell me.I use a buyers advocate as Im not ready to do the deals yet but can afford to get into investing.Our next purchase may be in New Zealand as I am told they are about three years behind us but unlike our last 2 I wont be making the same mistake.Does anyone have any thoughts on this (buying in New Zealand)?