Maxed Out

[Peter_Tersteeg]

Kathryn I agree that credit cards and personal loans also have their uses. I've used them for investment purposes myself and for me it was cheap and fast, but I did have an exist strategy from these debts.

For most people however, they simply don't know how to use these forms of credit wisely and they are given credit when they simply can't afford it. At least when you go through a home loan application there are checks and balances which ensure that you can actually afford the repayments. In many cases these simply don't exist with credit cards.

None of the people who I've met with credit problems got into trouble because of their home loan. They got into trouble because the got a home loan, then increased their credit cards, bought a car on a personal loan, took a holiday etc. Most people don't good vs bad debt and unfortunately this is what credit providers prey on.

 

[Brenda Irwin]

And to answer your question....there is nothing wrong with leverage......when buying and paying off one IP at a time, and not relying on capital gain ....

Damn, I knew I had done something wrong. I bought 27 ip's and stupidly waited a couple of years until their values doubled, then sold half to pay out all the debt on the other half!

Maybe I should have done it one at a time and lived to 200 and then I would reach the same place I am now?

 

[mbl]

Damn, I knew I had done something wrong. I bought 27 ip's and stupidly waited a couple of years until their values doubled, then sold half to pay out all the debt on the other half!

Maybe I should have done it one at a time and lived to 200 and then I would reach the same place I am now?

You are, fortunatley one of the few lucky ones.

 

[mbl]

Damn, I knew I had done something wrong. I bought 27 ip's and stupidly waited a couple of years until their values doubled, then sold half to pay out all the debt on the other half!

Maybe I should have done it one at a time and lived to 200 and then I would reach the same place I am now?

BTW.......you owe nothing on the remaining properties ?

If you do owe something on these properties, then what is the debt to ORIGINAL purchase price ratio ? In other words what % of the original purchase price is still owed to the lender ...

regards, mbl.

 

[Dazz]

Onya Brenda....

I reckon Brenda and her partner would say it's nothing to do with luck mbl...only loser's blame luck for their successes, and blame everybody else for their failures. Winner's take full credit for their successes and full responsibilities for their failures.

As for asking Brenda detailed debt ratio questions mbl, that's pretty cheeky of you given you won't reveal anything about your circumstances and think it vain and rude to do so. Hopefully she won't answer your questions.

 

[mbl]

Onya Brenda....

I reckon Brenda and her partner would say it's nothing to do with luck mbl...only loser's blame luck for their successes, and blame everybody else for their failures. Winner's take full credit for their successes and full responsibilities for their failures.

As for asking Brenda detailed debt ratio questions mbl, that's pretty cheeky of you given you won't reveal anything about your circumstances and think it vain and rude to do so. Hopefully she won't answer your questions.

Dazzling......oh dazzling. I didn't say anything condascending to Brenda, and feel that if she was able to get in and out and making a tidy profit, good on her. The very fact that Brenda sold half her IP's to pay off the other half, goes to show that she was wise in her investments and realised that the 'jig is up'.....and better sooner or later.

I have said many a time that we have a gew IP's and I have also said a few times that we owe nothing on these IP's.

I am not asking what she is worth.....I am asking her debt ratio....mine is 0. Satisfied now ?

 

[Ausprop]

"and realised that the 'jig is up'.....and better sooner or later."

probly wanted some SANF. if the jig was up she would have dumped the lot.

mbl I do appreciate your opposing views as it keeps things interesting just be careful that you aren't painted into a corner and have to start believing more radical ideas than you otherwise would have pursued (or not pursued i geuss!). YOu could be better served to chase down some deals than spend so much time tellign others why they are about to lose their shirts.

 

[BoatBoy]

Dazzling......oh dazzling. I didn't say anything condascending to Brenda, and feel that if she was able to get in and out and making a tidy profit, good on her. The very fact that Brenda sold half her IP's to pay off the other half, goes to show that she was wise in her investments and realised that the 'jig is up'.....and better sooner or later.

I have said many a time that we have a gew IP's and I have also said a few times that we owe nothing on these IP's.

I am not asking what she is worth.....I am asking her debt ratio....mine is 0. Satisfied now ?

But hold on mbl, here http://www.somersoft.com/forums/showpost.php?p=304728&postcount=10 you say that "We own 0.3423 properties.........that's over zero......"

Which is it , a third of a property, or a flock owing 0% ?

BB

 

[mbl]

But hold on mbl, here http://www.somersoft.com/forums/showpost.php?p=304728&postcount=10 you say that "We own 0.3423 properties.........that's over zero......"

Which is it , a third of a property, or a flock owing 0% ?

BB

You're a funny fella.....

 

[lizzie]

Damn, I knew I had done something wrong. I bought 27 ip's and stupidly waited a couple of years until their values doubled, then sold half to pay out all the debt on the other half!

i assume (from what i know of brenda - great inspiration that she is) that brenda was ready to retire from the acquisition game, and when she sold out half to pay out the other half, she still held enough properties to fund what she wanted out of life.

not all of us are at that stage quite yet. we're still acquiring and plan to be a brenda's stage within the next 5 years.

but, as brenda pointed out, if she hadn't taken the calculated and informed "risks" in the past, that she has taken, she would be nowhere in the position she is today - a position to retire and sit back, enjoy life, pay her own way and be a philantripist (sp).

 

[kathryn d]

Brenda has certainly been an inspriation to me.
It was because of her story (on line Part 1,never did get to read part 2)
that I finally started realizing my dream.

 

[see_change]

You are, fortunatley one of the few lucky ones.

mbl

If you'd been around for a while you know that there are a few other people who have been incredibly " lucky ". Lucky ?? Actually no . They just gone to the trouble of educating themselves financially. Again something you could do.

My biggest mistake was listening to a fimancial planner who advised a conservative approach. What I later found out was that approach was going to have me working and paying off debt for many years to come. Once I finally realised this was wrong , we borrowed and like Brenda and Karina to name another , sat back and watched our properties double in a short time. I still work , but because I want to , not because I have to.

If you've bothered reading this forum for any length of time before coming to your completely incorrect conclusion that every one is maxed out all the time , you would have found that many suggest that there is a time to max out and a time not to.

We have sold over half of our portfolio and have an LVR that is probably lower than the vast majority of Australian who are in the process of paying of a single PPOR . We, however have a nearly completed Dual occ on Sydney's upper north shore and several IP's most of which are grossing comfortably over 10 % . We have buffers that would allow us to have all our properties vacant for well over a year without troubling us financial.

I think Chicken Little is an appropriate term to describe you .

Cliff

 

[lizzie]

fortunatley one of the few lucky ones.

strange - i didn't realise how luck actually worked - i thought the harder i worked and the more i educated myself the "luckier" i got.

 

[mbl]

What exactly is this source of education ? Somersoft books ?

 

[geoffw]

What exactly is this source of education ? Somersoft books ?

No. The source of education like this is from many sources. Mostly getting out and doing it. Then taking time to deal with other people who have been successful in doing similar- many of whom have been doing similar for the last three or four cycles. People who have seen the downturns and the 30% drops- but who have stayed in the game. Because they know that after the 30% drops, there's an extremely good chance that history will repeat itself. For all the time these people have been in the property investment game, there have been downturns followed by rises.

mbl, is your only role in here to pour "stuff" on anybody else who dares to make any sort of positive comment?

 

[mbl]

Geoff....no that is not the case.

My role in this forum is to provide the 'other side of the story'.

I think that one line answers to my questions/posts, that are nothing more than snide remarks.......deserve the same sort of response.

 

[geoffw]

I think that one line answers to my questions/posts, that are nothing more than snide remarks.......deserve the same sort of response.

Then why am I providing a more substantial response to your snide remarks?

Lizzie's response was a fair one. One based on her actual experience. And a response I see refelected in my own experience.

The harder I work, the luckier I get. That's the experience of myself and many others in the forum. That was not a snide remark, it's something that happens in life.

And your only response was a snide remark.

 

[Brinkdude]

Luck

Hi Lizzie

I agree, the harder I work the luckier I become.

A definition I occassionaly use when I'm talking to someone about property and they "Geee's you're lucky" I say "no, luck is actually all about when
preparation meets opportunity". My definition of luck.

Cheers

 

[Les]

It's time, mbl ....

G'day mbl,

My role in this forum is to provide the 'other side of the story'.

Nothing wrong with that - except for HOW it's done. Making a mockery of well-meant answers isn't acceptable to many people on many forums.

I think that one line answers to my questions/posts, that are nothing more than snide remarks.......deserve the same sort of response.

Or, perhaps, some are responding by "giving as good as they get".


In case you hadn't realised it, mbl, I don't think your earlier posts gained you too much esteem on here. Probably because you breezed in as a "know-it-all" who was plugging a line. You poured contempt on many who responded, and justified your style by saying "it's not how I'm saying it, people just don't want to consider what I'm saying".

Well, mbl, I'm here to tell you that it IS how you are saying things that is raising hackles. You seem to treat this community as though we are a bunch of idiots. And, if you really felt that way, WHY are you continuing to be a member of such a sorry bunch?

Surely you would be better spending your valuable time where the members value your input, rather than with this bunch of "losers" !!! (Many of which I believe have already added you to their "Ignore" list).

Given the above, let me repeat on oft-asked question of you - WHY are you STILL here?

 

[mbl]

I am here to give the other side of the story. There are a lot of things that I do not agree with on this forum, and I notice that there are a lot of new users who come here asking for advice that FEW are actually qualified to give.

When I hear advice about putting 20% down and relying on equity to do it's magic.....I think it is about time someone else steps in and gives another point of view on the matter.....that basically say's that property and real estate could get you burnt if you are not careful.

I see a lot of back patting on this forum (some that is called for, and some that ain't).......and a lot of wishful thinking as well.

I will not sit here and here certain people in this forum tell of their 'success' stories, when there is another side to the story, and a very real one at that.

I don't like the fact that new members or maybe younger member with impressionable minds entering this forum, and people here just sit here and tell them that hey 'rely on capital gain' or the wopper 'even if you lose in the short run, you will come out a winner in the long run'.......this sort of advice is amaturish AND DANGEROUS to give..............

I have seen NOBODY on this forum simply state how to value a piece of real estate....all that I have seen is speculation, and other get rich quick and easy schemes. I have seen nobody discuss the realities of interest rates, and that over leveredging yourself is NOT a good idea for a first home buyer/investor.

That is the reason why I am here.....and intend to stay as long as the modifiers and time will allow me too.

thanks....mbl.