Helping kids get started

This could be done one of 3 ways:

1) You do nothing but offer her support and she obtains a 100 / 105 % loan for her first property.

2) You lend her 5% and thats it and she applies for the loan in her name and your interest is limited to the amount of the 5%. She is the one on the title and the loan application.

3) You look to guarantee an amount of 20% + and offer the bank a mortgage against your property for such an amount. Your Guarantee is limited to the 20% and can be released after a revaluation on the security she is purchasing. Many lenders now offer such a Family Guarantee style product.

May take a year or two however in saying that if she is making repayments and the balance is reducing and the value of the property is increasing it could be a shorter period than you think. In most cases your income would be assessed to ensure that you could support the 20% Guarantee amount.

There are a few other strategies I can think of but these would be the main ones.

Cheers

Richard Taylor
Residential & Commercial Finance Broker.
Licensed Financial Planner. Ph: 07 3720 1888
[email protected]
Looking for life cover – We Guarantee to beat any quote you have in writing.

This is available by a few lenders for both owner occupation and investment.

Cheers

Richard Taylor
Residential & Commercial Finance Broker.
Licensed Financial Planner. Ph: 07 3720 1888
[email protected]
Looking for life cover – We Guarantee to beat any quote you have in writing.

I think you should talk to one at the very least and see how you get on with him.

Richard has a solid reputation in this forum and he would be a good starting point not least because he has already started to chat about your situation.

Give him a call when you have some time to sit down and chat in detail.

I tend to prefer a straight deposit lend where you simply borrow the required deposit (25% is a standard fibgure to allow for buying costs too) against your home equity and “gift” it to your child. They should make those repayments for you on that loan as well as on the remainder they borrow – the other 80%.

The downside risk is losing that deposit. The downside of being guarantor is exposing your home as well.

Of course these are rare occurrences but some offspring have been known to marry badly or adopt a life of hedonism or crime etc [blush2]

All the best,

Simon Macks
Residential and Commercial Finance Broker
[email protected]
0425 228 985

Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.

If you are interested in following the Property Investing path, you simply must find a financial adviser who walks the walk. If you are reasonably financially literate you may not even need an F.P.

When you ring a prospective F.P to interview them, ask them how many Investment Properties they own or have owned. Ask for referrals to some of their clients.
Ask how they are paid – do they get trailing commissions on loans, or mutual funds they try to sell you, are they paid by the hour etc.

The above questions should also apply to your Finance broker if you use one, and definitely your accountant.

Cheers,
Marc.
[email protected]

“we get sent lemons; it’s up to us to make lemonade”