Do you want to invest in a second mortgage with a high-quality home buyer? With the tighter credit rules there are increasing opportunities for active investors.
With some of our home buyers we do an 80% mortgage through a bank, we then do a 15% second mortgage through an experienced private funder, and the buyer contributes a 5% deposit. Deals are only done with:
- good properties typically bought below valuation,
- buyers that earn over $100,000 to $120,000 per year,
- buyers that have a 5% saved deposit, and
- buyers must have mortgage protection or income protection insurance.
After 12 to 24 months we can arrange a new registered valuation and, provided the home buyer bought well, we can then fully finance them back to the bank.
As an investor, you earn interest rates from 10% to 15% depending on the quality of the deal. Whilst there is clearly some risk, our view is that the risk is a lot less than when the market was going nuts in the previous years. Each investment is small and it comes with a commensurate return.
If this is something that interests you, let us know. We are simply exploring ways to get our clients better deals (investors and borrowers) and will continue to explore ways of bringing borrowers and investors together.
