Forums / Getting Technical / Finance / where do i keep getting deposits from?

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  • Profile photo of styla2001styla2001
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    @styla2001
    Join Date: 2005
    Post Count: 1

    Hi..i have about $30,000 to start with.im debating to put it into say 3 properties or just the one.What im not sure about yet is how to get the deposit for the next property.Is it reccomended that you put your positive cashflow into your account to save for the next property?As it stands it just seems like it will take along time to come up with the next deposit and so on for further properties,hence not getting a return in your pocket for a while.Or when you have owned these properties for a while is it more common to borrow against these properties?I would be very grateful for any answers available.

    Thank you.

    Profile photo of byronent_2byronent_2
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    @byronent_2
    Join Date: 2004
    Post Count: 337

    Have you read any books, attended any seminars, spoken with any investors or done any research at all?

    Byronent
    Adelaide SA

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

    Hi Styla2001,

    It varies where your get your deposits from…

    * Cash/Savings
    * Equity
    * Other forms of security (being a security tied to the new investment property)
    * Shares (stocks)
    * family – friends

    Personally were i get my funds from, is from option trading, as in the form of option price appreciation + Releasing Property Equity, in purchasing more property, and repeating the cycle..

    the 2 fastests ways i gain cash deposit, are definelty, cash being released from the properties equity, + a very heavy load of option trading that i do.

    I have only ever sold one property, to help push and further the momentum of cashflow and deposits.

    Though as for serviceability, i do a system that is called off-set gearing + cash deposits that are enough to turn a property positive cashflow, but can be offsetted against negative geared properties..

    Cheers,
    sis

    ps.. i also put some strategies in place, to ensure funds are also available and that can be released almost immediately

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    Profile photo of foundationfoundation
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    @foundation
    Join Date: 2005
    Post Count: 1,153
    Originally posted by Still in School:

    fastests ways i gain cash deposit, are definelty, cash being released from the properties equity

    Please detail this process both for the education of styla2001 and for my own amusement…

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

    Hi Foundation,

    What i mean by that term is, drawing a LOC (line of credit) or refinancing that investment property loan, and taking those cash proceeds and using the new cash that is available, as new cash deposits, to purchase the next investment property.

    Cheers,
    sis

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    Profile photo of foundationfoundation
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    @foundation
    Join Date: 2005
    Post Count: 1,153
    Originally posted by Still in School:

    refinancing that investment property loan, and taking those cash proceeds and using the new cash that is available,

    I don’t think you’re actually ‘taking those cash proceeds’ at all. I think you are using a percieved increase in value as security to take on additional loan liabilities – yes, yes?

    Profile photo of shaztazshaztaz
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    @shaztaz
    Join Date: 2004
    Post Count: 113

    Still in School,
    Thank you to people like styla2001 who ask the questions, and people like Still In School who take the time to answer them.
    Many others benefit, including myself. Obviously we are all at different stages of learning, and your intelligent answers and excellent information are much appreciated.
    Thanks again sis,
    Regards,

    Sharon

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

    Hi Foundation,

    it varies from property to property..

    per example..

    if you have a positive cashflow property, with equity, then the extra cashflow, can be used to service more borrowed money, where the borrowed money, can be used as the cash deposit, (but in true reality, your borrowing at a much higher gearing.. more closer to the 100% and over mark.) and with that extra cashflow, it can offset, the extra amount of loans you put against that property.

    though in some cases for me, if i purchase a property, that is a steal deal property, it has been better off, using other forms of collateral as security instead of cash.

    One other way, i forgot to mention to purchase properties also was, if your a first time, you can purchase a first home on FHOG and then turn it, into an investment…

    ** this is something, i have also done, very minimal out of pocket expenses, and minimal legal costs..

    Cheers,
    sis

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    Profile photo of PropertyGuruPropertyGuru
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    @propertyguru
    Join Date: 2003
    Post Count: 1,502

    Along with other things partnership is one of the best way to keep on buying properties.

    Cheers
    PropertyGuRu [sultan]
    Mortgage Consultant
    [email protected]
    MSN ID: amitash, Yahoo Id: bornguru

    NZ loan pre approval from OZ in 48 hours

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

    Oh a very clever technique Property Guru taught me..

    ** though i have to be ssh ssh on it, and no i havent tried yet.. but tempted.. **

    Cheers,
    sis

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    Profile photo of TerrywTerryw
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    @terryw
    Join Date: 2001
    Post Count: 16,190

    If you can keep coming up with the deposits, you can always find finance.

    Others have also used:
    – deposits received from wrapping
    – option fees from selling options on the proeprty
    – personal loans (not good, as the rates are high and amoutns limited)
    – credit cards (Oh no!)

    Terryw
    Discover Home Loans
    Mortgage Broker
    North Sydney
    Click below to email me

    Terryw | Structuring Lawyers / Loan Structuring Pty Ltd
    http://propertytaxbook.com.au/
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    Lawyer, Mortgage Broker and Tax Advisor (Aust wide) http://propertytaxbook.com.au/

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