Help - how to borrow more?

Discussion in 'Loans & Mortgage Brokers' started by Joel2, 20th Apr, 2017.

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  1. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    The entity borrowing doesn't need an abn. The abn is needed for the person servicing the loan. Either directly or a related entity
     
  2. D.T.

    D.T. Specialist Property Manager Business Member

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    And need to be self employed as advised multiple times previously
     
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  3. DaveM

    DaveM Well-Known Member

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    I have personally used RAMS low doc lending. It is not a matter of registering an ABN then BAM! unlimited self certified servicing. The entity with the ABN needs to show its actively trading as a business (ie self employed) with 4 x BAS and business financials, plus an accountant to certify income levels drawn. Income increases are also limited to 20% over previous year to stop abuse.

    Anything else is mortgage fraud (eg having accountant sign off on income that does not exist).

    Dropbox - Borrower Certificate of Income Declaration (1).pdf
     
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  4. MTR

    MTR Well-Known Member

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    This is just the form.

    Not correct information at all......... I spoke to my RAMS broker 3 days ago.

    You do not need to be registered for GST if you are declaring income up to 75K as I have mentioned previously. I think you need to have your ABN for at least 2 years?

    However if you are declaring an income over $75K then you need to be GST registered.
    Not true... no business financials just accountant declaration.


    I have been through this process twice, its a low doc for a reason

    If you needed all this stuff why would you not go full doc???? makes little sense
     
    Last edited: 24th Apr, 2017
  5. tobe

    tobe Well-Known Member

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    First to the OP. Liberty first, then rams if you want to maximise capacity.

    To everyone talking about rams.

    Low doc can do 70% with an abn reg one year (80% 2 yrs) and an accountant declaration. If income is less than $75 SE income then also gst reg required.

    The accountant declaration breaks up income sources, with a box for rental, SE income and payg income. The assessor relies on the declaration for rental and SE income, and payslips for anything payg.

    There is a limit to 1mil total using the accountants declaration.

    Bas is required for lending over this amount, or as an alternative if your accountant won't sign the declaration, which happens a lot.

    It might've been me putting the idea for low doc in @MTR S head with a similar post some years ago.
     
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  6. zzzzz

    zzzzz Member

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    I have a feeling lots of properties will be up for sale in the next couple of years as many mum and dad investors have no clue what ARPA has recently done and just assume they can easily refinance I/O again. If Liberal/Labor is further tightening standards (e.g. land tax, restricting foreign sales), could lead to bloodbath as everyone is heading for the exit. One of my friends has 4 IPs which are all on I/O loans and has no idea what ARPA even means. Think their I/O loan runs out in 2 years.
     
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  7. euro73

    euro73 Well-Known Member Business Member

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    RAMS has two ways they offer lo doc. One requires 4 quarters of BAS statements. The other requires no BAS statements at all - only a borrower declaration of income and an accountant declaration of income.
     
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  8. euro73

    euro73 Well-Known Member Business Member

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    I just had a 1.728 Million loan approved (for me) without BAS statements , using only accountants declaration.
     
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  9. Anthony Brew

    Anthony Brew Well-Known Member

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    Are you sure that so much of the population uses IO loans and pays zero into offset to just keep it at the minimum of IO for 10+ years?
    I would have thought that the majority of people would use P&I, and out of what is left who understand the use of IO, most use an offset to reduce the interest paid, which would mean those using IO and literally paying nothing other than interest would make up a relatively small percentage of borrowers

    Or do you think this is wrong?
     
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  10. tobe

    tobe Well-Known Member

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    Yeh, rams are a sheltered workshop, so their franchisees argue with assessors and sometimes get the rules bent. Note they are also beholden to westpacs global limit which last time I checked was about $2.5mil?
     
  11. Username86

    Username86 Well-Known Member

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    Hi @Joel2 7 properties and a share portfolio for someone who has been in the workforce for such a short time is an awesome effort! What's the secret?
     
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  12. euro73

    euro73 Well-Known Member Business Member

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    No...its not I'm afraid . As others have pointed out, each new purchase also means a new rental income...so it is not a dollar for dollar replacement. Your borrowing capacity will increase as debt is reduced.

    No...they wont, I'm afraid. And no...it doesnt Im afraid. Not when 50% of all loans being written are I/O and rates are at historical lows and debts are at record highs. You continue to make the mistake many on here make, by believing equity equals borrowing power. It doesnt. Equity is useless without borrowing capacity. Once capacity is exhausted, equity cannot be harvested other than by selling. Unfortunately you are a generation too late to investing to be afforded that attitude. For the previous generation ( pre APRA) , equity indeed did equate to borrowing capacity, because they could harvest it using ever falling rates, ever increasing LVR's , unlimited I/O periods and "actuals" You unfortunately have commenced your portfolio building during rising rates, declining LVR's, rationed I/O lending and senisitised assessment rates. ie you dont get the big free ride they got :) Instead, you will actually need to employ a strategy. That strategy is called debt reduction. Its hard advice to hear I grant you, but its accurate advice all the same.
     
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  13. Liarliar

    Liarliar Well-Known Member

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    You need to look for a partner thats the best way , im currently looking for a husband.
     
  14. Matthew D

    Matthew D Well-Known Member

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    i love this forum :)
     
  15. Magnet

    Magnet Well-Known Member

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    I'm gonna need a second husband to improve serviceability :eek: :oops: o_O
     
  16. Coota9

    Coota9 Well-Known Member

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    Or sell your children as I have mentioned before!!;)
     
  17. Magnet

    Magnet Well-Known Member

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    I have one that keeps getting out of bed tonight to ask silly questions - going on EBay now!
     
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  18. Ethan Timor

    Ethan Timor Well-Known Member

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    This is true if you're reducing deductible debt. If you're reducing non-deductible debt by $1, you'll increase your borrowing power by more than $1. This is what I would attack first. :cool:

    And, yes, check Liberty. If they say no, then that's it until your financials change :confused:
     
  19. Anthony Brew

    Anthony Brew Well-Known Member

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    If I have no PPOR and have only IPs with money in the offset, would moving money in the offset to paying it down be worthwhile?

    Eg -
    property value 600,000
    loan 300,000
    offset 100,000


    If you wanted to borrow from equity, I could get
    (600,000 x 80%) - 300k = 180k .... plus 100k in cash
    = 180k available to spend

    If you put the 100k into the property
    (600,000 x 80%) - 200k = 280k .... no cash
    = 180k available to spend


    Is this incorrect? Is there some benefit to putting the cash from an offset into paying off a property as a way to end up borrowing more?
     
  20. tobe

    tobe Well-Known Member

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    No. Like credit card limits banks disregard offset balance, just looking at the mortgage limit.
     
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