Refinancing Later in Life



From: Gordon Austin

Hi Gang,

One financial strategy with investment property (eg Bruce Davis concepts from Building Riches book and seminar)is to keep refinancing your interest only property loans basically till the day you die. This allows you to use the capital appreciation for payment of future interest, expenses etc and use the remainder for living off. One would need to have life insurance etc in place to ensure those inheriting the assets don't find themselves with unmanageable debt or any at all.

Obviously you would need to buy properties that are likely to appreciate. And as one gets older it would be wiser to keep the Loan to Value Ratio somewhat lower.

My concern is that once you are older and retired is there a possibility that financial institutions may refuse to refinance an "interest only" loan and demand that the debt be paid out. So far I've been led to believe that in the world of property financing there is always a way to get the financing structure you require if you try hard enough and/or use the right people.

Any advantages/disadvantages and info on this would be appreciated.

Thanks - Gordon
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Reply: 1
From: Michael Croft

See Steve Navra's posts on cash bonds - they are a potential solution for the situation mentioned.

Michael Croft
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Reply: 2
From: Rolf Latham

Hi Gordon

The reality is that if you have the cashflow to support the deal from a number of non-job sources the lender wont care if you are 55 or 105.



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