Hi all, just wondering if anyone could give me a heads up with starting out.
i'm 21 and have been offered a house and land for 340k from my grand parents who inherit it. it was valued at 420k may last year. they are goin to do vendors finanance at
5%pa i have 68k in a savings maximiser. Just wondering about my options to by the house then use the equity to purchase a property and get some possitive cash flow. and then continue to purchase more properties or pay off the mortgage for the propety asap
thanx for any infoAmandaBSParticipant@amandabsJoin Date: 2005Post Count: 549
Wow what a great start at such a young age. Perhaps you can move in so you get the 1st home buyers grant and rent out the other rooms for some extra cash.
I'd suggest you pay for an independant valuation though before you sign on the dotted line, just to protect yourself!!Kipper57Member@kipper57Join Date: 2006Post Count: 252
Wow what a great start 80% LVR before kicking in your deposit so plenty of room for investment. Not sure about renting the rooms out as some times can be an infringement on your own privacy but guess its up to whether you are comfortable with that.
What does LVR stand for Wayne?Richard TaylorParticipant@qlds007Join Date: 2003Post Count: 12,024Kipper57Member@kipper57Join Date: 2006Post Count: 252
Loan value ratio = LVR the value of the property according to your post is 420k the amount you are buying it for being 340k is just about the 80% to be more precise 81% therefore you have almost 20% equity from the start if the valuations are correct, you would need to kick in 4k to avoid mortgage insurance.
You could choose to pay the 68k as a deposit to reduce this even further, reducing what you own on your own property, then create a split in your loan for an increase. This new loan is accessing the equity in your property which can be used for purchasing your investment/s. Or you could keep most of that money in the fund if you chosePursefattenerMember@pursefattenerJoin Date: 2004Post Count: 217
Good for you ..
Could you tell us how you have managed to save 68k at such a young age ? You would be in a far better position than most young folk I know . Your folks have done a good job on you