Construction loans are helpful when you want to engage a builder for structural renovations to your home or a knockdown/rebuild. Construction loans allow you to borrow against the future value of the property once it’s completed as determined by the banks externally appointed valuer. There are some important aspects to be aware of when looking for construction lending; –         You often have two options for a construction contract with a builder. Cost plus or fixed price. Cost plus outlines the basic known costs for the build, with the builder then adding…

Often, the banks maximum borrowing capacity is below your highest comfortable repayment. This can be due to many factors, some of which I have outlined here; –         Although the interest rate is below 2% for fixed and low 2%’s for variable on an owner-occupied product, the bank is using a stressed ~5.5% interest rate to assess the loan. Taking a $1,000,000 monthly loan repayment from the actual ~$4,000 to ~$5,700 in the banks model on a standard 30-year term. 30% higher! –         It’s a common misconception that if the rent from an…

Purchasing an investment property that already has a tenant means you collect rent from day one, with no vacant period and no lease fees to find a new tenant. The lease just carries on as it did before you purchased the property. Sound good? Of course it does. There are some possible problems to be aware of though. It’s very important to check whether the lease on your prospective investment is current or the tenants are on an expired lease. If the tenants are off-lease, they can give a short…

Looking for a property to purchase is an exciting time. Choices regarding location, size, number of rooms, and local amenities often see house hunters carried away in a deluge of daydreams and anticipation. But, before you get carried away, it’s important to check off the essentials first. Although organising your finances may seem drab in comparison to perusing sales listings, gaining pre-approval with a lender will give you confidence about how much you can afford to borrow. First and foremost you need to determine if you’re eligible to borrow money…

For some years, self-managed super fund members have been able to invest in residential property, as long as they follow strict guidelines. The first step is to have a discussion with an expert to determine whether investing through an SMSF is the most appropriate approach to property investment given your personal circumstances. If it is, the next step is to set up the SMSF, and using the services of a specialist is recommended. Do this before you start looking at an investment property to buy. Another tip is to be…