My partner and I are in a situation requiring a little guidance and would be grateful for any feedback in following a suitable path.
We have a PPOR and an IP which we had put on the market, SOLD, but finance fell through. Wanted to sell for a number of reasons :
1. Started a Business 1 year ago. (going well but wracked up C/R Cards with initial overheads)
2. IP is in a blue chip location, renovated, good equity but negatively geared.
3. Want to free up bad debts then use remainder of money to finance into a more neutrally or +ively geared situation.
The IP is an older Strata Titled Villa and as we found out about the finance falling through we also recieved the minutes to the last strata meeting revealing a 3 year redevelopment to the 9 Villas on the Block. Rendering, Garden Re-devolopment, etc.
We see these latest developments as a sign and would be best now to ride the tide and keep the IP for those next 3 years as it has become a more attractive option than exiting and entering a new deal. Better the devil you know in other words. But this doesn’t alleviate our Cashflow issue. Can anyone advise on how we could restructure this issue. Do we consolitate Debts, Re-Finance or are there better options???[blink][biggrin]Lionel Bocher
If cash flow is a problem now how will you finance your share of the improvements to the property? it may add to your problem of greater -ve gearing and -ve cash flow…On the other hand if the property is in a blue chip location, it may be a shame to sell and possibly lose out on longer term growth.
Perhaps you could unlock some capital with a loc and prepay the repayments 3-4 years up front (not sure if you can do this or not) but it may be woth asking the bank about?[dead2]
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