All Topics / Help Needed! / Any ideas on creative refinancing please?

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  • Profile photo of robynarobyna
    Member
    @robyna
    Join Date: 2005
    Post Count: 13

    I've had the 'standard' advice from my accountant, but would be interested if anyone has any creative solutions to maximise my current situation!
     – PPOR Sydney purchased 2000 $360k, value approx.$600k, Portfolio loan balance $185k
     – IP New Farm purchased 2002 $321K / Rent $420/week. IO 5yr loan $336k maturing DEC07, value $585k

    I've seen a strata unit on the Gold Coast, outstanding views can never be built out and good holiday rental occupancy (80%) with room to improve nightly rental rate. The idea was to sell Brisbane, pay off my home loan and reinvest in the Gold Coast apartment for occasional personal use and in the holiday rental pool rest of the year.

    This of course selling New Farm creates CGT implications, agent commission on sale etc etc – I'd really like to KEEP what I have and buy the Gold Coast apartment as well – any clever ideas out there please?
    Thank you

    Profile photo of JONCHUJONCHU
    Member
    @jonchu
    Join Date: 2004
    Post Count: 112

    This is what I would do, I would keep the lot, wont sell anything, get a line of credit against PPOR, enough to use for 20% deposit + costs for the new property, negotiate well, double check that the numbers stack up nicely and lock another property into my portfolio. Not sure how creative this is, however it works.

     

    Happy Investing

    Profile photo of robynarobyna
    Member
    @robyna
    Join Date: 2005
    Post Count: 13
    JONCHU wrote:

    This is what I would do, I would keep the lot, wont sell anything, get a line of credit against PPOR, enough to use for 20% deposit + costs for the new property, negotiate well, double check that the numbers stack up nicely and lock another property into my portfolio. Not sure how creative this is, however it works.

     

    Happy Investing

    Thank you for taking the time to reply Jon. I really would like to build on what I have already. I'll look at the figures again however servicability might be a problem. Being half-way through year 2 of my own business means that my earnings aren't up to where they were when I bought the last IP – only temporary but the loan matures next month so I have to do something!

    Profile photo of Mortgage HunterMortgage Hunter
    Participant
    @mortgage-hunter
    Join Date: 2003
    Post Count: 3,781

    If serviceability is a bank problem but you are happy to maintain the payments then consider a NODOC loan.

    Profile photo of JONCHUJONCHU
    Member
    @jonchu
    Join Date: 2004
    Post Count: 112

    Hi Robyna, if you can afford it and fits your investment goals, there are many ways to do it, i.e No Docs as Simons suggests.

     

    Happy Investing

    Profile photo of hgwellshgwells
    Member
    @hgwells
    Join Date: 2003
    Post Count: 127

    might help to look at your credit cards too, I just learned that if you say have an amex or visa with a 20,000 limit, even tho you pay it off every month, the lenders consider it maxed out when working out your finances…  it all adds up.  Good luck

    Profile photo of Richard TaylorRichard Taylor
    Participant
    @qlds007
    Join Date: 2003
    Post Count: 12,024

    Hi Hgwell,

    The comment about lenders assessing your credit cards as maxed out even though you pay them off each month is not quiet correct. Some assess your liability as a percentage of the credit limit some will ignore the liability if you can show 3 months of nil balance statements.

    With regards to the question in hand one other consideration would be to look at how you are going to roll over your existing loan balance as when it comes of the  5 Year fixed rate it will be considered as a totally new loan again by your lender and will require re-underwriting.

    Might be an idea to get your broker to re-assess your entire position at the same time and structure our refinance so that it does not hinder your progress going forward with future additional properties.

    Richard Taylor | Mortgage Broker helping investors build their wealth thru property
    http://www.mortgagecapitalaustralia.com.au
    Email Me

    100% Investment Finance now available on selected properties. Email us for further information.

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