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Finance options/ advice please

Discussion in 'Property Finance' started by ms420, 22nd Jun, 2016.

  1. ms420

    ms420 Active Member

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    Looking for finance options/ advice. My details are as below:

    Income: 120k excluding Super
    Deposit: 200k
    Residential status: Austrlian PR
    Other income/ spouse income: None
    Dependents: wife and 2 kids of 10 & 13

    Looking to buy properties in the range of $1.2 Million.

    Thanks.
     
  2. albanga

    albanga Well-Known Member

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    This will be the first response of 10 telling you to see a broker. There are heaps of brilliant ones on here.

    What I would say though is that with that income and 2 kids that you would not be able to service a 1mil loan.
     
  3. Mumbai

    Mumbai Well-Known Member

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    Even if you could borrow to buy property worth 1.2 million, your repayments would be around 4600 per month on P&I. Do you really want to do that with 3 dependents?
     
  4. Jess Peletier

    Jess Peletier Mortgage Broker - Australia Wide Business Member

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    Is it for an IP or a home? That will make a difference, as will your current debt/liabilities. Not enough info here to be very helpful unfortunately.
     
  5. Steven Ryan

    Steven Ryan Mortgage Broker Business Plus Member

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    Big question Jess asked there.. investment or owner occupied?

    Are you retaining extra savings outside the $200k? You'll need to throw pretty much all of it at a $1.2mil purchase..
     
  6. ms420

    ms420 Active Member

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    Thanks for the replies.

    I want to know what's the max I can borrow.

    This is for own use not IP.

    In the current market, would it make sense to buy in Sydney for own use or buy a small IP and wait?

    Where can I find a trustworthy or good broker? Is there a list or review system for mortgage brokers?

    Thanks.
     
  7. Redom

    Redom Mortgage Broker Business Member

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    It will be tough borrowing that amount.

    Assuming no other debts, no credit cards, no family tax benefit income, no other loans, etc - you're looking at borrowing power amounts of around $550-$600k for owner occupier deals. That's going to fall well short, despite a strong individual income.

    Its very tough in Sydney for owner occupier house purchases on single incomes.

    Re brokers, usually the recommendation of a friend or colleague is a good idea. You could also read through a few posts from some of the brokers here and find someone that suits you. There's quite a few very good ones spreading their knowledge on these forums.

    Cheers,
    Redom
     
  8. Jess Peletier

    Jess Peletier Mortgage Broker - Australia Wide Business Member

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    This depends very much on your individual circumstance - for eg, will your wife work in the near future? Are you comfortable renting? Is there a problem with your current housing situation?
    All these things will determine what's 'best' - it may have nothing to do with current market conditions.

    If the market is the only factor, Sydney is peaking so it could pay to wait from that perspective. Also, aside from what the bank will or won't lend you, can you afford a $1.2M home? Not only at these rates, but at 5%? 6%? 8%?
     
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  9. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    The forum is full of them. Read a few posts and see who you like.
     
  10. ms420

    ms420 Active Member

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    Thanks for your thoughts.

    I am wondering if I was a single parent with two children how would I be able to afford a similar property of 1.2Mn with my current income? Does the calculation change as there is 1 less dependent? However the uncertainty of a single income source doesn't change.

    I did speak to a broker friend and he gave an estimate of $500-600k borrowing. I am trying to explore any other possibility to extend my borrowing.

    Given time of 6-12 months, Sydney market could potentially cool down a little bit to provide a buying opportunity of a property about a 1Mn. If my wife doesn't start working by then, and my financial condition remains same, my borrowing capacity would not change. I am wondering what else I could do to make my dream of owning a property in Sydney come true.

    Also, what is the best of my money in the bank until then?

    Thanks.
     
  11. Mumbai

    Mumbai Well-Known Member

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    You can do that quite easily so with 500-600k. Heck, even 400k.
    Why are you trying to stretch beyond your capacity?
     
  12. Barny

    Barny Well-Known Member

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    Earn more through current job with pay rise, or overtime, or side business, or a second job perhaps. Or a new higher paying gig.
    And keep saving.
    How much can you save per year currently?
     
  13. Jess Peletier

    Jess Peletier Mortgage Broker - Australia Wide Business Member

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    Is your dream to own property in Sydney, or live in property in Sydney? Or both?
    Why not buy what you can afford, and rent what you can't? Best of both worlds then :)
     
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  14. Gockie

    Gockie I'm an ISTP-A female, so I might be a bit quirky! Premium Member

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    Wow.... guess I'm extremely fortunate (in terms of borrowing capacity) i'm in double income no kids scenario to be able to get the loan we got for the new ppor without using bridging finance.

    550-600k only buys a unit for a heck of a lot of Sydney, and I don't see that as so suitable housing for a family with 2 soon to be teenaged kids....
     
  15. Mumbai

    Mumbai Well-Known Member

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    Sydney is huge. You can definitely buy a 3 bedder in that budget. You can get a good townhouse or even a house in Western Sydney in and beyond black town. OP has not mentioned where they want to buy.
     
  16. Gockie

    Gockie I'm an ISTP-A female, so I might be a bit quirky! Premium Member

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    Hey you are very right! I think my colleague (who ended up buying in Doonsode during the boom) was being very picky.... wanted something "new", not "old". Plenty of weatherboards seem to be priced in that bracket in Blacktown.

    For a 1.2mill budget, I dont think he was looking at Blacktown! But I agree, Blacktown gives affordability, access and a much more affordable buyin price.
     
  17. Kashmir

    Kashmir Well-Known Member

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    You could look at Glenwood, 4 beds in the mid 800-900+ range.
    Glenwood, NSW 2768 Auction Results & Sold Property Prices in Glenwood, NSW 2768 (pg 1)

    Good family friendly area for the most part and in the growth area of North West.Kings Langley, Marsden Park (further out) have a lot of new releases. I'm not suggesting now is the best time to buy but for a PPOR and if that's what you want, then there are options much lower than 1.2.
     
  18. ms420

    ms420 Active Member

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    Thanks guys.

    While I am thinking of Glenwood or Box hill, paying the current prices just for the heck of getting in the market might land me trouble if the market tanks. It would end up being my IP but not for my own use due to my target location being Cherrybrook due to the school (Cherrybrook technology high school), and it is far from being affordable for now.
     
  19. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    What is your personal capacity to make repayments per month ?

    Aside from borrow cap and real affordability deposit size means you would new lmi if over an 859 purchase anyway - unless you qualify for a 90 no Mi product .

    TA

    ROF
     
  20. The Y-man

    The Y-man Moderator Staff Member

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    Aaagh! What are you planning to do???? :eek:


    :p

    The Y-man
     
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