Finance Made Simple
Aug 30th, 2017 • Industry News
Finance made simple
When a busy doctor who had worked with banks to set up finance for her investment properties visited Approved All Loans Group she walked away with three more properties and a newly simplified finance structure that saved her money.
Lisa Jones*, a doctor who had purchased six investment properties while working with bank loan officers, called on Shaun Howie From Approved All Loans Group to help her streamline the loans attached to the assets.
“As I started working more closely with her, I discovered there was a complex web of loans attached to the portfolio,” says Shaun Howie. “So it made sense to try to rationalise and simplify the loan structures. At the time, Lisa had three loans with the same banks and didn’t know which properties were used to secure individual loans.”
Each time Lisa bought a new property, she took out a new loan. As a result, there were multiple loans attached to each property, as she had accessed the equity in the existing properties to purchase additional properties. As well, many of the properties in the portfolio were cross-secured, creating a very complex arrangement.
“The problem we faced was that any refinancing would almost certainly have involved a massive exposure to that lender’s mortgage insurance,” says Shaun Howie credit adviser. “But she had a huge plus in her favour: as a doctor, she was able to take advantage of a benefit some lenders give doctors so they don’t have to pay mortgage insurance.”
Knowing this, and knowing which lenders offered this bonus, meant that Shaun Howie From Approved All Loans Group was able to restructure the loans attached to Lisa’s property portfolio so that there was only one loan associated with every property, rather than two or three.
“We made sure none of the properties were cross-secured, making a very complex structure much more simple. It’s also certainly helped Lisa’s accountant at tax time,”
With the Shaun’s help, Lisa purchased a further three investment properties, and now owns nine in various locations, worth approximately $4 million dollars.
*Client’s name has been changed.
Find Shaun Howie at Approved All Loans Group who can use their industry knowledge to help you untangle your finances. www.approvedalg.com.au
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