Q: How is my loan structured?
A: Usually, the loan is written as an interest only loan fixed over two years. After the loan is payed off, you’ll choose whether to reinvest or have your capital returned. You choose to have your interest paid on a monthly or quarterly basis. Of course, we can adjust the terms if necessary.
Q: What happens if the buyer stops making payments to you?
A: If for any reason our buyer should default making their payment to us, we do not default making our interest payment to you. Our investors are key partners in the success of our business. We do everything possible to exceed expectations and meet every interest payment!
Q: What happens if there is a fire?
A: We have sufficient insurances covering the property at all times.
Q: Who will determine what the property is worth?
A: We conduct extensive market research prior to purchasing a property. A valuer from our lenders panel will also value the property accordingly.
Q: Who pays the land tax, council rates, water rates, insurance and maintenance on the house?
A: You pay nothing. It’s the buyer’s responsibility to pay for all costs associated with the house. We monitor our buyers to ensure that all outgoings are paid on time and have reserve funds in place to cover any temporary shortfalls or costs.
Q: Can I liquidate my loan to you before 2 years?
A: Yes, you can liquidate your loan. It may take a few weeks for us to setup other investor funds to substitute with. Please be advised that it’s in your best interest to enter into this investment with the intent to invest for the term of our transaction (typically 2 years).
Q: What are my costs?
A: You have no extra costs, other than supplying the loan amount. All fees are paid by us!
Q: If it’s difficult for your buyers to get bank financing, how do you determine that they’re a good credit risk?
A: We pre-screen our buyers very thoroughly. Our buyers supply us with their credit file. We also confirm they’ve paid current and past landlords on time and verify their employment and income. We look at their debt to income ratio and the amount of their current rent. Plus, they must pay us a minimum deposit of approximately 5% of the sales price of the house.
Q: Is vendor financing new?
A: Vendor financing is centuries old and has been used in Australia since the early 1900’s. Today, vendor financing can frequently be found in country towns and rural properties, as well as capital cities. If you speak to solicitors over the age of 50, they’ll tell you that it was common practice after World War II when banks weren’t lending.
Q: How do you buy your houses?
A: We network and bargain hard. Also we find that there are a small minority of sellers who have to sell quickly for whatever reason – divorce, job change, too many bills to pay, etc. These sellers are willing to discount their properties in order to have a quick sale and immediate piece of mind.
Q: Do you buy units?
A: No, not usually. Our philosophy is that the value is in the land, not the building which also minimises risk to you. Land appreciates - buildings depreciate.
Q: If I were to invest my money and you defaulted payment to me what would happen?
A: Firstly, we have never missed a mortgage payment either personally or through our business. We use a professional management company to direct all payments to our lenders (you) before we get paid. We also allow you to register a caveat over the property, which protects your interests by preventing any further transaction on the property. Remember we are partners and our business would fail if we were to do the wrong thing by you.
Q: Why are you willing to pay high interest for a loan? Is there a high risk?
A: It’s the availability, not the cost of the money that allows us to purchase property regularly. Bluntly, the numbers stack up and if we can’t raise the money to buy a house, we can’t sell it to make a profit. We have invested considerable time, effort and money ensuring that all possible risks are covered by proven methodologies from the outset.
SUMMARY
Anyone with surplus money (savings, self managed super fund or term deposit – we’ve even used peoples equity from their home!) can make a secured return, much higher than what is offered by the banks. You don’t have to be a seasoned investor or guru in Real Estate - leave that to us! You don’t pay any costs, loadings or commissions. We pay your solicitor’s fees. Your loan is for a short period of time - two years. We think it’s a high yield low risk way to get a good return, but that is for you to decide.
Through every step of this process, we have tried to minimise your risk, because we’re interested in building a lasting relationship with you. If anything goes wrong, we’ll fix it.
You have legal protection and all pertinent documents are communicated efficiently. We are personable people, who answer our phone and emails any time you need to talk.
You will earn a fixed rate of interest and collect your income from us monthly or quarterly; you decide.
It’s been our experience that the economy doesn’t affect our buying and selling strategy. People will always need food and a place to live. Property is a safe, secure investment that historically has appreciated over time since records began.
If you are interested in this high yield, low risk investment please call Brett,
on 0417 458 785.
We look forward to a long lasting business relationship with you.
If you would like to OWN YOUR OWN HOME, or are interested in what options are available to you, why not contact us today and escape the rental rut - permanently!
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