Wraps are working in Perth WA!

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From: Steve Gilmore


Hi everyone. Just wanted to put a quick note to say that we are making the wrap technique for cashflow work here in Perth WA.

We have buy and holds and wraps are a great way to show serviceability to banks, as 100% of the income is taken into account.

There sure was a lot of red tape and misinformation in the media about it, but once the paperwork is done, its plain sailing!

My friend Craig and I did 5 of them in 4 weeks once we had set things up.

The figures for two of them are:

1. Our price $75,950, buyers price $90,550. Our weekly repayments are $122, theirs are $185. We sold it an hour after we settled. So weekly cashflow of $63 and $68,200 over the life of the loan.

2. Our price $83,458 theirs $99,500. Our weekly repayments $134, theirs $191 so $57 per week and $$62,700 over the life of the loan.

The other 3 fit in between these figures.

They work well, with no maintenance, management or hassles, so you can get on with the business of acquiring growth assets.

We are happy to help anyone who wants to try this technique.

Good luck property investors!

Steve Gilmore

 

[michaelg]

Reply: 1
From: Michael G


Congrats!,

Good to hear, how did you go with registering as a credit provider and paying fees?

Did you manage to sort that out?

Michael G.

 

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Reply: 1.1
From: Susan Pope


Hi Steve (and Craig)

I also live in Perth, have some buy and holds, and am very impressed with the headway you have been able to make in WA.

It was great to hear you say the banks can understand your ability to service the loans. Does that mean they will allow you to borrow for as many properties as you like? I have read elsewhere that once you get past about 4 wraps you come to the "end of the road" in the banks' opinion regarding serviceability.

I have managed to meet only one woman in Perth wrapping properties she bought approx 10 years ago. She draws up the contract herself (instead of a solicitor) and also does the settling (instead of a settlement agent). As she mentioned "pooling" money with other like-minded individuals to purchase more properties, I figured showing serviceability might be a problem she has. She deals with BankWest, but has now moved to the Eastern States.

As yet I have not been able to find a finance broker / bank in Perth who understands this wrapping strategy. Also accountants I have approached feel "wrapping" is far too risky. You guys seem to have beaten the "red tape" very successfully. Well done!

Is there anyone you can suggest I talk to (ie solicitor, accountant, finance broker, bank), to do some homework in order to get started in Perth??

Also, which suburbs have you had the most success with wrapping? Do you buy units/townhouses/houses on land or a mixture?

Are there any seminars you would particularly recommend? I prefer to find out as much as I can first, and then I feel I learn more at seminars.

Thanks in advance for any light you may be able to shed in this most innovative of investment strategies...

Susan

 

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Reply: 2
From: Ayesha Todd


Steve, what suburbs are you targeting for your wraps? Reason I ask is that we have a unit in Orelia and are looking at buying somewhere else in the near future.

 

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Reply: 2.1
From: Susan Pope


Ayesha,
Are you wrapping your unit in Orelia?