Lots of errors in this effort!
**Note: Article has been removed from this post and link inserted for copyright reasons.**
of course, banks are so understanding when you fall behind on your repayments, aren’t they?
very poor journalism, done on the basis of an article on jenman’s website.
btw I’m not into wrapping, but I’m not particularly against it either.
cheers
rSo if I buy a home with a mortgage, lose my job and my wife gets sick, the bank will be understanding and not worry about it?
People who eneter into a wrap deal understand the contract and agree to it. If they don’t breach it there is no problems. How is this so different to getting a mortgage through a bank?
I’m sure if the “approved” agencies breached their agreement with Neil Jenman he would be very understanding….
I have never heard such a thing.
If they had of had a solitior acting on thier behalf … none of this would have happened (at leaset they would have been made aware of the issues.[baaa]
my contracts allow fair and reasonable terms… 30days late and a late payment notice is served, penalty interest is payable after 14 days…. and if not resolvable then I can rescind contract… I have sometimes let people just rent instead for 12 months and they can recommence installments without wearing a penalty… depends on how soft or firm the market is I guess.
Cheers,
Kiwi
[baaa]The main difference between a ‘wrap’ contract and a standard home loan is that little thing known as the UCCC. Take a look around for yourself… http://www.creditcode.gov.au/
Kiwi, not everyone can afford a solicitor. It might be a good indication that a wrapper would be less likely to be able to afford it seeing they are considering a more expensive wrap over a standard loan.
Many of these people are desperate and will sign anything. I believe that there should be legislation enacted to require independent legal advice to be sought by all purchasers of non-coded loans. This way, they would be made aware of the pitfalls by an independent party and could not complain if something went wrong.
Brokers still cop it and we arrange coded loans. Wraps have a LOOOOOOONNNNNGGGGGGGGG way to go before being accepted by the majority.
Robert Bou-Hamdan
Mortgage Adviser0414 347 771
[email protected]
http://www.mortgagepackaging.com.auFREE Finance-Related Newsletter – Click Here
Comments made are of a general nature and should not be construed as individual advice.
© 2004 Mortgage Packaging Pty LtdMortgage Adviser said this: “Many of these people are desperate and will sign anything.”
Maybe these people should take responsibility for their choices… they’re grown adults after all… but of course, it’s easy to handball blame isn’t it?
cheers
rThere are different levels of education Richmond. Poverty is also a large factor. Desperation is a vendors dream. Allowances need to be made.
Robert Bou-Hamdan
Mortgage Adviser0414 347 771
[email protected]
http://www.mortgagepackaging.com.auFREE Finance-Related Newsletter – Click Here
Comments made are of a general nature and should not be construed as individual advice.
© 2004 Mortgage Packaging Pty LtdHi,
The research behind this article seems second-rate at best, including:
1. The journalist did not contact me.
2. He spelt my name incorrectly.
3. John Burley is not my mentor. He quotes from a book where the current edition no longer includes that comment, in fact, that comment has not been publsihed for several years. Despite this, the comment is taken out of context.
4. The discount for the wrap kit has been available for some time now, not since Thursday as the article seems to indicate.
5. The finer details of how a wrap works, especially when someone is evicted from the property, are not fairly or accurately portrayed in the article.BTW, Rob… wraps must comply with UCCC too.
Regards,
Steve McKnight
**********
Remember that success comes from doing things differently.
**********Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.comSuccess comes from doing things differently
I did not know that Steve. So how do you get around the comparison rate requirements and clearly presented loan offer documents etc?
It seems there is a lot of ambiguity in a lot of the vendor finance contracts.
Robert Bou-Hamdan
Mortgage Adviser0414 347 771
[email protected]
http://www.mortgagepackaging.com.auFREE Finance-Related Newsletter – Click Here
Comments made are of a general nature and should not be construed as individual advice.
© 2004 Mortgage Packaging Pty LtdRob,
You don’t get around it. You have to work through the issue and disclose as needs be.
I feel there is only ambiguity in the contracts used by people who are not familar with the correct way to put a wrap deal together in a win-win way.
Cheers,
Steve McKnight
**********
Remember that success comes from doing things differently.
**********Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.comSuccess comes from doing things differently
its a hard one
on one hand they are suppose to be adults and if they sign on the doted line it is assumed that their mature mind and intelligence would have already considered the worse case scenario if they default on their repayments
on the other hand, it is easy to want a house of your own – a basic need that although you know that the worst case scenario might happen you hope that it wouldn’t and eventually pay up and have a lovely home
where does personal responsibility start and commercial responsibility end
for eg. even if the cigarette company doesn’t tell you smoking is bad, one must have internal logic to think that unnatural smoke pumped into your lungs day in and out can’t be good for you in the long term. even now people still smoke knowing its bad for you. we should blame the government for allowing cigs to be made or the company who is making them or the milk bar across the road for making the access to cigs easy
mostly i agree with Rob, proper checks and due diligence into the financial undertakings by the vendor and proper understanding with an independent body is a must
thats means you need to keep telling them, if you cant pay you LOSE your home even if you have paid up 99% of it. do you understand?, are u sure u wanna do this?, really?, u get the picture
It is all about integrity my co investors…
I do not let any person sign a contract without there own solicitor…. If they are not able to ‘afford’ one…. then they are not ready to own a home as it is one of the biggest moves they have ever generally made & solicitor costs are very minimal in comparison.I do not wish to ever end up on Today tonight with a toothless wonder saying I stiffed em and we should never have ever let em into a house. – I plan on being here a long time not after the quick buck and am building my name on integrity and reliability (as a transaction engineer)
I do not place porpors into my wrap homes as they would never work out anyway.
My ethics prevent me from taking money from someone I do not think will be able to afford or cope with the repayments.Hi,
thats means you need to keep telling them, if you cant pay you LOSE your home even if you have paid up 99% of it. do you understand?, are u sure u wanna do this?, really?, u get the pictureI reject the idea put forward that someone who has paid 99% of a contract and misses a payment walks away with nothing. It is factually incorrect. If this was the case any magistrate in the country would nullify the contract in a second as being grossly unfair.
What needs to be stressed is the financial undertaking being assumed when entering into the (any) contract. This is stressed in the pre-signing documentation that must conform to UCCC regulations.
It’s time people started to include some of the media commentators started to include some of the facts rather than the hyped in their stories.
Regards,
Steve McKnight
**********
Remember that success comes from doing things differently.
**********Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.comSuccess comes from doing things differently
I certainly come close to insisting that my buyers seek indepedent legal advice – but I still leave it up to them.
The problem with this is that too often they pay the money to get ADVICE – and instead get a whole bunch of false opinions instead.
This happened to me again this week. My buyers went to get legal advice and were told:
1) This is illegal
No, it’s not.
2) It’s a scam
Hmmm, sounds like an opinion
3) You’re only paying interest, so you’ll never pay it off
Well, I ran the loan amount, term and interest rate through 3 different loan calculators on the internet, and all three of them came up with a P&I payment exactly the same as in the contract… doesn’t sound like an interest only loan to me
4) You’ll never be able to refinance
I’ve had 2 buyers refinance in the last few months
5) The house is grossly overpriced
Of the 60 houses listed on realestate.com.au for sale in that suburb, my house was equal to the fifth cheapest. The house about 10 doors away is listed currently for only $3k less than I sold my house at it. Maybe it’s not “cheap” but grossly overpriced? (to the point that they would never be able to refinance, to put the comment in context)
6) If you default you’ll get chucked out immediately and you’ll lose all the money you’ve put into the house
Go read the UCCC, there’s no way I can chuck someone out “immediately”. And like any loan, if you default very early in the contract, you probably have no equity and so get nothing back. But if my buyer has equity in the house, my contract specifically states they’re entitled to their share after sale costs.I guess the point of all this is – independent legal advice sounds good as a concept, but only when the advice received is good advice, rather than opinions which border on falsehoods.
My buyers did decide to still sign the contracts and buy the house, because by the time I’d gone through all the points above, they realised that the lawyer basically was an idiot.
The really sad part is that the lawyer never talked to them properly about their rights and responsibilities, or raised legitimate issues they needed to understand (which I explain in detail anyway!) such as the fact that title doesn’t transfer until refinancing.Keep smiling
Felicity
DAMN FELICITY!!!
You certainly have become a pro at this from what I remember. GOOD ON YOU!
Steve, I should probably clarify that when I talk about dodgy wraps etc, I am not referring to the professionals who make it a business and do it efficiently, fairly and compliantly.
I admire those who do this as I think wraps are great if done properly but I still see so many illegally operating shonks out there.
About this issue of defaulting and being entitled to equity upon sale of the property, what happens if three wrappers default and the property is not sold for 23.6 years? Does this imply that there will be three caveats on the property claiming their share?
What happens if the last wrapper defaults and the vendor decides to keep it? How do they get their equity then? These equity clauses tend to all related to sale of the property. The vendor can still borrow against the equity and get into trouble. How would the equity be repaid then if the lender takes the security?
I think there are too many variables to address and I would love to see someone doing this.
Steve, I have not bought a wrap pack only because I am informed that it relates predominantly to VIC and I cannot find a decent solicitor who know their stuff.
Maybe if I suck up to a professional NSW wrapper, they may help me out.
<wink, wink>
Robert Bou-Hamdan
Mortgage Adviser0414 347 771
[email protected]
http://www.mortgagepackaging.com.auFREE Finance-Related Newsletter – Click Here
Comments made are of a general nature and should not be construed as individual advice.
© 2004 Mortgage Packaging Pty Ltdjeez felicity
you’re good
got every angle covered
better start your own wrap pack
i’ll buy it
anyone else?Robert
In my contracts, if there is equity available when a default occurs, then under the default clause the property must be valued first. Then, either I can choose to pay the equity to the buyer (upon them removing their caveat of course!) or the property must be sold and the equity paid from the proceeds.
You wouldn’t get a situation with multiple wrap buyers all waiting for the property to be sold to get their equity out, or multiple caveats.Keep smiling
Felicityfjficm
Thanks! [blush2][blush2]
I think I’ll leave it to the experts.Keep smiling
FelicityMerry Christmas Felicity…
What if the property does not sell for a suitable price?
For example…
What if the wrappee spent 10-20k on the property and the market dipped and they would not receive anything according to the market valuation?
Technically the caveat could remain as they spent 10-20k on the property and would be entitled to this amount at the very least if there is no added equity.
Also, do you require submissions to be made to you for all renovations for approval?
Robert Bou-Hamdan
Mortgage Adviser0414 347 771
[email protected]
http://www.mortgagepackaging.com.auFREE Finance-Related Newsletter – Click Here
Comments made are of a general nature and should not be construed as individual advice.
© 2004 Mortgage Packaging Pty LtdHi All
Great discussion.
Unfortunately there are a lot of people out there with a victim mentality and the first thing they do is run to the newspapers or those trashy current affairs programs.
I have not finalised my first vendor financing deal yet so I am no where as experienced as some people on the board.
What I have been doing so far is to get permission from perspective buyers to tape the conversation where I explain the contract. I make sure it is explained in full so if any thing happens down the track I will not be the star attraction on some sleazy TV show.
I have been in a position where I had a great business ruined through one of those shows (although I did not appear personally) I can tell you they are far from ethical; in fact I would say Pluto is closer that their ethics.
All I can say is you have to protect yourself because no one else will.
Merry Christmas
Kerwyn.
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