Other Options


REVERSE MORTGAGE


Reverse mortgages allow homeowners to use the equity they have built up in their homes. The concept was originally created in the USA to allow "house-rich, cash-poor" elderly or retired homeowners access to their home equity to support things like living expenses or emergency bills without having to sell their homes.


Reverse mortgages are generally available to residential property owners aged over 60. Different lenders have different age entry levels, and the percentage of equity or amount of money you can leverage depends upon your age. These mortgages allow you to release funds by using the equity in your property, and are secured by a registered first mortgage on your principal place of residence and potentially, your residential investment property, dependent upon the lender.

 

Deposit Bonds

A Deposit Bond is a guarantee that is used as a substitute for the 10% cash deposit you are required to pay up-front when purchasing a property.
A Deposit Bond has terms ranging up to 48 months. This means you can keep your money working for you right up until settlement, when you pay the full purchase price.

 


SELF MANAGED SUPER FUND (SMSF) Loans
Your self-managed Super can now borrow money to buy real estate.


Since September 2007 self-managed Super Funds have been allowed to borrow and charge their assets as long as a special structure is in place.


This gives investors the same flexibility to invest in real estate inside their Super Fund as they've enjoyed outside it.


Conditions:

  • The trust deed establishing your super fund must give the Superannuation Fund Trustee the power to buy real estate, borrow money and mortgage property
  • Your investment must comply with the Superannuation Industry Supervision Act Including the sole purpose test, which ensures the Super Funds are obtained just for its member's retirement benefit
  • Your fund must have a written investment strategy to keep its real estate investment consistent with its overall strategy
  • A property trust deed must be established. This essential document can help determine if there are adverse GST, tax or stamp duty consequences.

The trustee company should not be associated with the investor or their fund.