Accessing Equity?

Viewing 6 posts - 1 through 6 (of 6 total)

collie
Participant
@collie
Join Date: 2004
Post Count: 60
March 21, 2005 - 9:02 am
I am trying to wrap my head around this concept and I can’t seem to get it.
How do you actually practically access equity? What if it is only a small amount say $15,000?
How do you get to that money? Can you access equity with any sort of loan or is it worth having an equity access loan, I have spotted one with interest rate of 6.5%
Anyway any info to help me understand will be most appreciated.
Thanks All,
[blush2]
collie
debtdogg
Member
@debtdogg
Join Date: 2004
Post Count: 136
March 21, 2005 - 9:40 am
Hi Collie
Generally accessing the equity is by refinancing your current loan either with your current lender or through another You obviously need to know that the property will actually value up enough ( a real estate assessment is not the same as a valuers valuation) and then if you qualify financially, ie the bank is happy you can repay the extra loan, hey presto, you can access the equity.An “access equity” loan is usually just a marketing name given by some lenders so they can nab your business.
I would however suggest that because of the fees etc involved that unless you have a good use for the $15000, that you wait until you have more equity. You will usually have to pay an application fee, mortgage duty, discharge fees (if you refinance through another bank)etc etc and this will eat away at the money you borrow.
cheers
markk
Happy Hunting
http://www.kentscollections.com
foundation
Member
@foundation
Join Date: 2005
Post Count: 1,153
March 21, 2005 - 12:50 pm
Originally posted by collie:
How do you actually practically access equity?
How do you get to that money?
Sell you house![biggrin]
Alternatively, aquire some additional debt using the increased value of the house as security for the loan.
Cheers, F.[cowboy2]
collie
Participant
@collie
Join Date: 2004
Post Count: 60
March 23, 2005 - 12:17 pm
Thanks for your replies guys, so refinancing is in your opinion the best and only way to access equity. I want to acess my equity to buy further investment properties, using equity as deposit.
The equity access loan is fee free.
Thanks Again…….
collie
Greg F
Member
@greg-f
Join Date: 2004
Post Count: 83
March 23, 2005 - 1:52 pm
Originally posted by collie:
I want to acess my equity to buy further investment properties, using equity as deposit.collie
Hi Collie
Before you do ANYTHING, read Peter Spann’s “How to Build a $10 Million Property Portfolio in 10 Years”.
Spann’s book is excellent, and it also has comprehensive chapters on how to go about building equity through refinancing. Also excellent tips about using RP data over the past 10 years to work out which suburbs are going to return the biggest % equity increase over the next 2 years of a 5 year cycle.
Also do a Search under “Peter Spann” on this forum, as he had a brilliant thread here some 4-6 months ago.
Cheers
Greg
Mobile Mortgage
Member
@mobile-mortgage
Join Date: 2003
Post Count: 913
March 23, 2005 - 5:37 pm
Hi Collie,
If you are releasing equity from an owner occupied property (PPR) for the sole purpose of investment, then I would suggest you keep the new loan separate from the non deductible debt, i.e. a split loan. Cheers.
Regards
Steven
Mortgage Broker
Mobile Mortgage Market
Ph: 0402 483 216
[email protected]
http://www.mobilemortgagemarket.com.au
PLEASE note comments made should not be taken as specific taxation, financial, legal or investment advice.