Advice needed for ex-pat investor

Hi I'm still a beginner as an investor in property in Australia. I currently live and work in the UK. I have plans to move home and live in Australia again in the future.

My investment portfolio so far:

I have a 50% share in an investment property - PP $127,000; valued at $300,00 (Investment loan with one of the big 4 banks)
I bought another investment property (house) - PP $200,00; valued at $300,000 (Investment loan with one of the newer banks/lenders in Australia)

I am have made an offer on a block of 4 units (under 1 title) and am looking to get the finance to purchase - PP $637,000

I have contacted a broker I have used for the previous purchases and he has given me the information below regarding the finance

I’m looking at utilising ******** Bank again as you have your existing security with them from your house purchase and we will be looking at cross collateralising both properties.

I’m going to need to make sure the loan to value ratio stays under 80% based on the security you are looking to purchase.
In this instance we have two security properties we can tie together. P St and H St. The total value of both of these securities is approximately $936,880.00.

Based on the type of security you are looking to purchase the maximum loan to value ratio (LVR) we can look at is 80%. 80% of $936,880.00 is $749,504.00.

Your existing loan is approximately $205,000.00, we subtract this from your total lending limit of $749,504.00 and it leaves $544,504.00.

Total purchase is $636,880.00 and maximum loan is $544,504.00 which leaves a shortfall of $92,376.00 plus we need to cover fees and charges of approximately $25,643.00 which is close to a total of $118.019.00 required from you to make settlement happen.

Your new loan amount will be $544,500.00. Based on the information you have provided for me you can do it, however it will require you utilising some of your savings.

Considering I am an ex-pat Aussie and therefore some lenders would not lend under that criteria - I am wondering if this is the best way to go about it as $120K of my savings will be all of it? Would anyone suggest any alternatives? Is it a good idea to cross-collateralise the properties? Would any lenders take into consideration the 50% share in my first investment purchase?

Any help or advice would be greatly appreciated.

depending on some issues( mainly who u are employed by and your evidence) it may be possible to get to a 90 % lend on the existing properties (with the other owners permission and them also drawing their share of equity) and an 80 % lend on the 4 units on the one title as a struggle. Not many lenders will do the 4 units on one title at 80 % even for locals, especially seeing this one looks like a regional security

Cross coll,....... hmmmm clearly doesnt result in what u want here.

Thanks peoples - Im still trying to find the best way around it. Still searching for LVR above 80% and appartently they are out there - where I dont know!

My broker tells me that x-coll would be the best way to save on the initial layout of all my funds.

I am going to look at a 'strata title' for the units after purchase. Would the x-coll make this difficult? Have any bearing on it at all?

I'm thinking of the 'strata title' process then I can refinance at better valuations and therefore better rates etc.

Any thoughts would be greatly appreciated.
Hi Mick

Xcoll doesnt increase the LVR potential per se

80 % lvr is 80 % lvr regardless if the places are on 80 % stand alone loans, or they are crossed.

In fact this time round xcoll can get in the way, because the property u already own you can likley take to 90 %, the block of 4 units u cant.

ie, your exist place goes to 90 = 270 - 205 = 65 k

637 x .8 = 509.6

Total avaulable - 574.6

thats only 30 k more...........but still proves my point.

You can then approach the partner of the other proerty you have and see of they are interested in pulling equity from it.

It looks like u have zero loan on this.

80 % of 300 = 240, your share 120 k

sorta fixes all the issues if its possible

If Xing allows the deal to get done and you have the right exit plan to get out of the X later then why not.
XCOLL is usually a purphy

Hi Y33

Because 9 times out of 10, the deal can be done without xcoll in the first place.

This one is a possibly an example. The only seeming benefit here is for the broker ( one less deal to write same comm) and the lender ( greater "contribution")

If I just had ten bucks for everytime someone came to me where their intention didnt end up matching their path during the last 2 volatile years......

You might well have the RIGHT exit plan is today, and tommorows' circumstances may be totally different as to what a lender will allow, lower lvrs and restictions to security and borrwers as prime examples over the last 12 mths.

Im not stoopid enough to say xcoll isnt suitable under ANY circumstance, just took a client to cross 4 ips to release 1 so we could access equity, coz there was no other way. If there is no other way, then its a move forward, otherwise its likley just a future liability and a discussion point.

Rolf, my why not was for the OP, as in give it a go if it helps get what you want.

A check of my posts will show I went down the X path to make sure a deal would go through when no other options were available. Definitely agree it is not the preferred option but it can work quite well when needed. Now no longer X sort of and under my terms. Basically 1 loan tied to two props but everything else is unencumbered and a very nice healthy position that suits me.