Moderators please delete this thread

[Murdoch]

Deleting thread for privacy reasons

[deborah]

Is there a way to change it to separate titles once you've taken over ownership from your aunt? If your mother needs to go into aged care or a retirement community, she'll probably need the money from her half of the property.

[Ozlady]

Qn: are you an only child?

[Ozlady]

Hi Murdoch

These are my thoughts ONLY..not knowing your full family situation...

(a) I think may (?) give rise to potential problems in future if you are not the only child...you may want to discuss with mum and the other kids and put it in writing

(b) you have chosen tenants in common vs joint tenants...ruminate on that...

(c) 3 mil is quite a big , lumpy investment in a SINGLE asset ...are you buying more in the future?

(d) but at the end of the day, you and your mum will have a 1.5 mil loan on a 3 mil asset...this may turn out to be very advantageous in your future borrowings ..as in a 50% LVR..heck! you can even borrow more (but mum must come to the table)


However your question is whether you should borrow to the max versus partial..based on my own experience (and i am retired) ..looking back...i wish i had leveraged more:)....max borrowing capacity only occurs during a particular span of your working life...and don't forget you can always sell those shares if shit hits the fan (pardon moi French)....

Proviso: you have a solid working job going forward:)

[marty998]

Sound plan, leave the shares to continue growing, borrow the $1.6m and spend the next however many years paying it down. Try and take a mix of split and variable loans so you can take advantage of cheap rates as well as filling up a big offset account, when in future you might need to buy out the other half.

Hopefully by then the shares will also have grown to such an amount that you’ll have the capital to redevelop the block if you need to.

Appreciate the points about family risks but I feel those will be there regardless of what you do, so you might as well carry on.

[deborah]

Sounds like you've got a good plan.

[happy]

Bit late to the party, but I agree with Marty. Don't sell the shares and get a mortgage for the whole amount. I'm not sure how much the rent is, but I like to   consider all the negative possibilities and how I would handle them. eg What if mortgage interest rates go up? At what point would you have a cashflow problem? ( the banks have a built in margin in what they will loan you for this these days I understand, but good to do your own math). What if the property market tanks? And so on.