Finance

[WebBoard]

From: Mike .


Using equity
From: David
Date: 8/1/00
Time: 4:12:17 PM

Great site, execept for the cheap salespeople. This is my situation:

have IP worth around $100 owe 75. Have own house worth about $265 owe $210. Now Im looking at using equity in my home to purchase a property in Bris.

I have 2 questions:

1sty, if I use my equity in my house , will I be able to build up equity and purchase property in the future or will my own house be tied and can only be used once?

2ndly, if so, How viable is it to get a personal loan to get a deposit? Then get a loan through another bank, freeing up my home.

 

[WebBoard]

Les

Reply: 1
From: Mike .


Re: Using equity
From: Les
Date: 8/2/00
Time: 10:50:16 PM

G'day David,

Replied to the one above, and then found this one - since this post has more detail, we can be more specific.

Since your buying in Brisbane, there's almost enough Equity in IP#1 to give you a deposit (you would not need any more than $12k - $15k for MOST Brisbane properties - unless you're buying from one of the marketeers ....) So you could borrow against IP#1 to get #2 - but it might be a little tight just now - so rather than visiting TWO lenders to get two "half-loans" you might be better to borrow against "home" for this one.

Take a look down the postings for info on "Line of Credit" loans (dated 23 May 00 titled "Line of Credit vs Offset Account" - it's a LONG way down ...) From your figures, you may be able to get a LOC loan for maybe $30k - which could be TWO deposits in Brisbane, plus some of the costs. I don't have LOC, so I don't know if Banks will lend to 90% - so $30k might not be on. But a LOC will allow you to pay it down, then borrow again for IP#3, then #4, etc. without having to ask for another loan.

I think a lot of the "detail" was covered in that May posting, so take a look and see if that helps. Do come back with more questions if you need to.

Regards, Les

 

[WebBoard]

David

Reply: 1.1
From: Mike .


Re: Using equity
From: DAVID
Date: 8/3/00
Time: 3:43:12 PM

Les, thanks for your words of wisdom, much appreciated.