5 % or 10 % cash deposit these days ? Upgrading Perth PPOR

Hi. Atm though the way rents have dived in Perth I'm not coping with repayments so I have to sell my property with the most equity in it which is my ip. If I sold my ppor at this stage I'd be lucky to not make a loss on it. I need the cash from the sale to be able to afford the NG on my 3 x 2 ip villa.

 

I might pay lmi or I'm thinking of another option. Getting a personal loan of around $25,000 as my 10 % deposit for a $250,000 Loan. If I can help it Id like to keep all my savings in tact.

 

Getting a personal loan will seriously impact your borrowing for property.

As others have suggested, speak (and listen) to a mortgage broker. There are many competent brokers here.

 

Anything under 20% deposit and you'll be paying LMI.
Getting a loan to do deposit is probably not a good idea

 

Getting a loan for a deposit is an excellent idea, if you could still get the bank loan to work. it could cost you a little more in interest but the LMI savings could be many thousands.. You could then work at paying this loan off asap.

 

And the loan could be mortgage insured even if under 80% LVR

 

A personal loan to cover the difference in deposit is possible - many lenders will refuse a loan on this basis so getting the right lender selection is essential.

The personal loan being added into the mix will put a strain on your borrowing capacity so you will need to be in a strong financial position to have the borrowing capacity pass.

 

yeah that's what I've gathered from reading the threads here, it impacts your serviceability.

Early days, i'll see a mortgage broker later on down the track

 

This looks ok, NAB offering 95%


Found this (sorry for large font size, it wont let me change it)


What are LMI and LVR? - Home Loans - realestate.com.au


How high can my LVR be?

Different types of borrowers will be able to set up home loans with different Loan to Value Ratios. For example, as at September 2017, NAB currently offers loans to owner-occupiers with an LVR of up to 95%. Investors can have an LVR of up to 90%.

 

Hi

i've decided to stay put in my ppor. I'll have just a small mortgage on it. Will be a good idea. Lifestyle balance. Will be able to save some money too.

I created a thread Small PPOR Mortgage - Lifestyle & Investment

 

I just thought of another option!

The other option I have is to move out of my PPOR and turn it back into an IP and because it'll have a smaller mortgage on (due to the sale of my other IP) it means it wont be so negatively geared. It'll be more affordable to hold it. This way I wont have to sell my current PPOR and buy another new IP.

Also Perth rents are set to rise. I read somewhere that 12000 vacancies is a renters market, 6000 vacancies its a landlords market and right now in Perth there are 9000 vacancies. Its a balanced market now.This will help with my holding costs

 

Where will you live then?

 

The other option is

I could live in my little unit for another 10 years or so, and save hard, and ride the Perth wave. Sell either my 3x2 IP villa or sell my PPOR in 10 or 15 years time when hopefully both properties have doubled. Then use some of the profit to buy myself another PPOR.

But before 10 years time I think i'd like to buy more IP's. I'll hopefully be in a good position in say maybe a few years or 5 years time to buy an IP again. I just dont want to be struggling when buying another IP. I want to be able to afford to hold onto all 3 properties this time around.

 

I was thinking of renting something cheap, a 1 bed. thats just one idea. I think i like my second idea better which i posted just above my reply to yours!

 

Could be worth considering if the savings are worth the move. Might be good to hold on to a property for more capital growth.

 

I think I'll stay put in my ppor for now. I'll be able to save heaps and put it towards a cash deposit on my next IP. That or wait till I have some equity growth in my perth propertys. That might take a few years. Currently i have negative equity in one and the other one my ppor zero equity.