A
Anonymous
Guest
From: Anonymous
To all you wrappers and ex-wrappers out there I want to see if I have got this “WRAP” methodology right.
All I need to do is go to a low socio-economic area and find a cheap property.
The rental income needs to be just short or above what the loan payments would be if I had a loan. .(ie rental potential $160 p/w repayments $150 p/w.)
Where the house prices are at the minimum end of the house prices scale.
An area where it would take an investor about 5 – 7 yrs to achieve a 10% appreciation in the value of a property.
Where there are a high amount of rental properties.
Where residents usually can not become home owners under their own steam.
An area where there is a very low income ratio of residences.
Then I find a bank that will provide me with a loan for the property, which I will then sell to someone else. I will not pay out my loan at this point, the new buyer will pay me and I will then payoff my original loan with the bank.
The new owner will pay me 2%…to …5% or whatever above what I have obtained my loan for with the bank.
When I have located this area I then need to take the contract I have had drawn up, through one of the few solicitors that know about the ”WRAP” methodology and find a bank manager that is prepared to accept it.
This bank will then let me take out a fixed P&I loan, where I will be paying dead money into the principal until I can sell, entice, or locate a potential buyer or s_ _ ker for the house. The buyer will be shown that by increasing their weekly rent by $20.00 p/w week or so they can purchase their own home. They don’t need to know what the monthly payments will be, nor what the valuation is of the property. They don’t need to have a good credit, or have a savings record, because if they, or when they default I will come in and turf them out. Then resell the house to the next potential s_ _ ker.
I have been only told about the good things that can be achieved from wrapping a few dozen properties. I have been told there are no risks to me as the investor it is a lot safer than “Buy and Hold”. I will become wealthy in a very short time. "Yeah pigs might fly", if you have not yet guessed I have not been converted from “Buy and Hold” to “WRAP”. There appears to be too many closed doors and “What Ifs” that have not been answered.
To start with a few of questions that I still have:
To be good at doing a “WRAP” do I have to be a really good salesperson? (Will you have fries with that?)
From what I see, I need to sell a non potential property to someone at a price above the current market value, so how is this going to let me sleep well at night?
If “WRAP” is such a good system, why don’t the Banks know about it?
What happens when your buyer defaults and you can not find another buyer to take over the loan?
What happens when interest rates increase and the buyers can not keep up with payments? You are then stuck with a string of principal payments that are not tax deductible.
Has this system been tested in any courts in Australia? If so what were the results?
What is the view of “WRAP” by the ACCC? Where the investor is being charging the buyer 2%…to …5% or whatever above what the banks are charging?. How is this a fair system from the view point of the buyer?
What are the advantages of buying and selling a property in a month to make $10K to $20K profit and then pay CGT . On top of that see the tax department treat you as a trader and increase your tax rate. Where are my profits going?
There are the “Haves” and the “Have Nots”. I currently "have" +ne rentals that are built on sound trusted wealth creation principles, with which I am very pleased. I "have not" got a desire to jump into something that has got so many gray areas.
No I do not need to attend a seminar on “WRAP” or read the book again, I want you simply to tell me how you have translated “WRAP” into a working system for yourself.
Moonshine.
To all you wrappers and ex-wrappers out there I want to see if I have got this “WRAP” methodology right.
All I need to do is go to a low socio-economic area and find a cheap property.
The rental income needs to be just short or above what the loan payments would be if I had a loan. .(ie rental potential $160 p/w repayments $150 p/w.)
Where the house prices are at the minimum end of the house prices scale.
An area where it would take an investor about 5 – 7 yrs to achieve a 10% appreciation in the value of a property.
Where there are a high amount of rental properties.
Where residents usually can not become home owners under their own steam.
An area where there is a very low income ratio of residences.
Then I find a bank that will provide me with a loan for the property, which I will then sell to someone else. I will not pay out my loan at this point, the new buyer will pay me and I will then payoff my original loan with the bank.
The new owner will pay me 2%…to …5% or whatever above what I have obtained my loan for with the bank.
When I have located this area I then need to take the contract I have had drawn up, through one of the few solicitors that know about the ”WRAP” methodology and find a bank manager that is prepared to accept it.
This bank will then let me take out a fixed P&I loan, where I will be paying dead money into the principal until I can sell, entice, or locate a potential buyer or s_ _ ker for the house. The buyer will be shown that by increasing their weekly rent by $20.00 p/w week or so they can purchase their own home. They don’t need to know what the monthly payments will be, nor what the valuation is of the property. They don’t need to have a good credit, or have a savings record, because if they, or when they default I will come in and turf them out. Then resell the house to the next potential s_ _ ker.
I have been only told about the good things that can be achieved from wrapping a few dozen properties. I have been told there are no risks to me as the investor it is a lot safer than “Buy and Hold”. I will become wealthy in a very short time. "Yeah pigs might fly", if you have not yet guessed I have not been converted from “Buy and Hold” to “WRAP”. There appears to be too many closed doors and “What Ifs” that have not been answered.
To start with a few of questions that I still have:
To be good at doing a “WRAP” do I have to be a really good salesperson? (Will you have fries with that?)
From what I see, I need to sell a non potential property to someone at a price above the current market value, so how is this going to let me sleep well at night?
If “WRAP” is such a good system, why don’t the Banks know about it?
What happens when your buyer defaults and you can not find another buyer to take over the loan?
What happens when interest rates increase and the buyers can not keep up with payments? You are then stuck with a string of principal payments that are not tax deductible.
Has this system been tested in any courts in Australia? If so what were the results?
What is the view of “WRAP” by the ACCC? Where the investor is being charging the buyer 2%…to …5% or whatever above what the banks are charging?. How is this a fair system from the view point of the buyer?
What are the advantages of buying and selling a property in a month to make $10K to $20K profit and then pay CGT . On top of that see the tax department treat you as a trader and increase your tax rate. Where are my profits going?
There are the “Haves” and the “Have Nots”. I currently "have" +ne rentals that are built on sound trusted wealth creation principles, with which I am very pleased. I "have not" got a desire to jump into something that has got so many gray areas.
No I do not need to attend a seminar on “WRAP” or read the book again, I want you simply to tell me how you have translated “WRAP” into a working system for yourself.
Moonshine.
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