Wraps in WA

From: Glenn Mott

At the first Perth Freestyler meeting last week, one of the topics mentioned was wrapping properties in WA and the challenges surrounding them.

I would be interested in speaking to anyone who has attempted or completed any of these deals.

Glenn Mott
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Reply: 1
From: Bob Quiggin


I came across a site about a year ago with an investors club in WA talking about wraps. I haven't got the reference but I found it searching for wraps and Australia.


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Reply: 1.1
From: Michael G


I believe there is such a site, I too cannot remember its name, but a few key words in a search engine should produce results.

Michael G
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Reply: 1.1.1
From: Rick Otton

go to the association site www.financewraps.asn.au but you can do lease options like some guys do in Qld and S.A. or you can pay 1% fee of retail sale price to have a license or skip all the govt legislation and sell your houses principal payments only therefore not charging interest and therefore being outside the credit code.
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From: Tony Dixon

Rick wrote:
>...or skip all the govt
>legislation and sell your
>houses principal payments only
>therefore not charging
>interest and therefore being
>outside the credit code.

I'm trying to understand clearly what you are saying here.
Do you mean set up an adjusted interest-free mortgage for a larger amount, and receive regular principal payments?
And this bypasses the credit code?

If this is so, the adjusted amount could be a scary figure - even though having the same PV. And you'd need to to take into account interest rate variation too.
Intriguing idea.

cheers, Tony
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From: Michael G


Find a good spreadsheet amortization table and play with the figures.

Basically you work out your profits and thus your weekly/monthly payments, then recalculate it without interest keeping the same repayment figure.

As for variable interest problems, well one solution is to get a 10yr fixed 1st mortgage or something and have a 10yr wrap. that way your insured against a change in rates.

Or have a 1-5 year fixed rate with a ballon period at the end (ie lump sum payment) meaning they have to cash you out in 1-5 years as part of the contract (ie refinance you out of deal).

Michael G

nothing I have done, only read about.
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