Forums / Getting Technical / Finance / Is there such thing as a “Base of Operations”Loan?

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  • Profile photo of monkey_boymonkey_boy
    Member
    @monkey_boy
    Join Date: 2004
    Post Count: 3

    To all out there…

    Hello from myself, a newb trying to bridge the gap between stupidity and managed risk with a little capital and alot of knowledge.

    Just wondering, is there such thing as a line of credit loan that allows the holder to not only deposit pay, rent etc like a normal LOC, but also to get all expenses such as repayments for other loans direct debited out of it? … Or is that what a normal LOC does…

    I just ask because it would be good to have a ‘base of operations’ rather than checking a few dozen individual loans / repayments etc.

    On a side note, do many ppl on Buy and Hold strategies out there use Direct Debit facilities for their renters? if so, has it been implemented with much success?

    Ah i just remembered another thing… hope you all don’t mind too many questions, but if each one of you answer one then it’ll be easy [:D]
    My situation is a just graduated student with almost no saving history recorded (i withdrew money and put it in a jar) until the last 2 months, where I have saved up enough to invest in shares and move down to Brisbane for Uni. Question: how much would a bank/lender loan me, and what would the likely LVR be?

    Hope this hasn’t gone over some unseen limit,

    Luke

    Profile photo of Steve McKnightSteve McKnight
    Keymaster
    @stevemcknight
    Join Date: 2001
    Post Count: 1,749

    HI,

    Thanks for your post and welcome to the forum.

    quote:


    I just ask because it would be good to have a ‘base of operations’ rather than checking a few dozen individual loans / repayments etc.


    A few years back St. George offered a portfolio loan, which was one facility with a number of sub-loans. In essence this allowed for easy admin by having just the one main account.

    Re: question about lending. It comes down to an issue of servicability and risk. Lenders usually allow repayments up to 30ish% of income. The LVR would usually be 80% – perhaps higher in some circumstances, or lower if you are self-employed with no financial track record.

    Cheers,

    Steve McKnight

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

    Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
    https://www.propertyinvesting.com

    Success comes from doing things differently

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,173

    Hi Luke

    You can arrange direct debts on LOCs wihtout any problems. So you can pay the interest ona another loan from this account.

    Lenders generally want to see 6 months genuine savings for high LVR loans, but these days there are a few 90% LVR loans that do not require genuine savings. And from memory, there may even be one or two that allow 95% loans wihtout genuine savings.

    Terryw
    Discover Home Loans
    North Sydney
    [email protected]

    Terryw | Structuring Lawyers / Loan Structuring Pty Ltd
    http://propertytaxbook.com.au/
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Aust wide) http://propertytaxbook.com.au/

    Profile photo of Still in SchoolStill in School
    Member
    @still-in-school
    Join Date: 2003
    Post Count: 1,844

    Hi Monkey_Boy,

    Another thing to remember is, depending on how you structure your loan repayments either, weekly, fortnightly, twice monthly or monthly. Make sure your direct debit facilty recieves the money before the loan repayment is due.

    Its best to organise with the agent if you can have money directly debited to your account on specific dates of every month to ensure, that there is money there, when the repayment is due.

    cheers,
    s.i.s

    People 4get that by saving just $3 a day & investing it sensibly
    over a working life, you’ll end up with around $1 million

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