smsf home loans

SMSF Home Loans – Do this before you apply

Even though SMSF home loans use the property you are buying as collateral, that does not mean you can avoid doing some careful research before applying.  Assessing your financial circumstances is very important if you plan on getting the best loan features, structure, interest rates and loan terms.  Unfortunately, many peoplesmsf home loans simply apply for a SMSF home loan without proper preparation and wind up spending thousands of dollars more than they should over the course of the loan.

Make Sure Your Credit File is Accurate and Up to Date

Credit reports are only as good as the information provided to the reporting agency.  Here are just a few situations that can have a negative effect on your credit without your knowledge:

  • a lender uses your identifying information by mistake and places negative markers on your credit report
  • identity thieves may have taken out loans, credit cards, or even mortgages using your good name and reputation
  • a creditor fails to mark a payment you made on your account, and then reports the late marker to the credit reporting agency.

Failure to address these issues before applying for an SMSF loan can result in higher interest rates and a reduced ability to negotiate for the best terms possible. While it may take a month or two to straighten out your credit file, it is more than worth your effort.

Gauge Your Super Fund and Projected Earnings

At the current time, your Super may look stable and capable of supporting you during your retirement years.  If you take out a loan now, and then fall on hard economic times, your Super will also stop growing.  From health problems to job loss, you should always consider both positive and negative influences on your retirement fund. If you find catastrophic projections more likely than positive growth, it may be best to wait before committing to taking out loan using your Self Managed Super Fund

Decide What You Want to do With the Loan Money

Having money without a viable spending, savings, and investment plan is a sure path to ruin. It does not matter if you earned the money or borrow it in the form of an SMSF loan.  Before you apply for a loan, think about how you will spend the money, and if those plans are really worth the effort. For example, if you already own one home and have an investment property, but very little in the way of liquid capital, think twice before buying another investment property.  The last thing you will want to do is secure a piece of prime property, and then not have the funds available service the debt.

SMSF loans are a valuable tool as long as you take sensible steps to get the best possible deal. Making sure your finances are portrayed in a positive light, gauging the economy, and planning your expenditures will ensure you can pay the loan back and progress financially at the same time.

Contact the team at Sherlock to see if a Self Managed Super Fund Loan is right for you and we will tailor a comprehensive loan proposal suited to your individual needs.

smsf loan

3 Things to Consider Before Applying for SMSF Loans

smsf loanThere are few things more vexing than having your Superannuation fund barely growing when some well placed real estate investments could enable you to retire much earlier.  Self Managed Superfund Loans (SMSF) can help you tap into that retirement fund even if your credit rating is less than perfect.  As good as this may sound, there are three important factors to consider before you begin the application process.

Your Age and Proximity to Retirement

If you are interested in investing, then you know that Australia is a star in many areas of the economy.  On the other hand, people in their 50’s and 60’s that lost everything during the 2007 Recession in the United States can tell you that there are no guarantees when it comes to investment.  Therefore if you are within 10 – 15 years of retirement, try to avoid putting more than 20% of your Super at risk.  An SMSF may still be a viable option at this stage if you can live on 80% or less of your total retirement fund.

Current and 5 Year Projected Value of Potential Real Estate Investments

Foreign citizens and business owners are more eager than ever to tap Australian markets, open shopping centres, and engage in other wealth promoting activities.  From that perspective, having one or two key real estate investments in your retirement portfolio can ensure a wealthy retirement with plenty left for the next generation.  When appraising the value of any given property:

  • ask local business owners about other companies that may be interested in moving to your area
  • take a survey of the local people and find out which products and services they are interested in
  • find out which businesses offer these services and find out how soon they can build in your area

What Limits Will You Set for Property Management?

Regardless of your age, property ownership will also come with a range of expenses.  This includes taxes, building maintenance, and interest on any loans taken using the property as collateral.  Once you know the current and 5 Year projected value of the property, it is time to decide how much money you are willing to spend before leasing or even selling the property.  If you miscalculate the projected value, or wind up taking more loans to maintain the property, you will have to sell it at a loss in order to prevent further financial problems.  At the very least, if you have a target number in mind, making that decision will be a bit easier when and if the time comes.

SMSF loans are a tool you can use to generate increased wealth.  While Australia’s economy may be strong, keeping these three key things in mind can help you protect your investment and ensure that you get the most out of each investment.  As an added bonus, when you start doing basic real estate research, you are sure to find out all kinds of fascinating things that may lead to other money making opportunities.

Contact one of our lending experts to discuss your options and tailor a comprehensive Loan Proposal suited to your specific lending needs.

Melbourne Suburbs to Watch in 2016

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The REIV’s list of suburbs to watch this year.

The Victorian property market finished 2015 on a high with a record number of auctions held in November and December. While median house price growth is expected to moderate this year, population increases, a robust economy and relatively low interest rates will support buyer interest in 2016. In 2016 the REIV expects moderate growth across the city with further price increases in a range of suburbs in Melbourne’s inner, middle and outer rings.

Some suburbs across the city to watch in 2016 are:


Footscray – Close to the CBD and recorded double-digit growth in 2015. Footscray remains affordable given its location in Melbourne’s inner ring. Improving infrastructure and gentrification likely to result in solid longterm growth. Median price: $780,000

Altona – Close to the CBD (13km) and to the bay and has seen double-digit growth in 2015. Private sales market tightened in 2015 and clearance rate increased, despite listings being up 17 per cent. Median price: $710,125

Sunshine – Still offers very affordable buying and is within 11km of the Melbourne city centre. Larger land blocks are proving attractive to both buyers and developers. Median price: $530,000

Spotswood – Another inner west Melbourne suburbs which is poised for further growth in 2016. Despite listings increasing significantly in 2015, the median days on market fell 23 days and clearance rate improved 13 per cent. Median house price remains well below the inner Melbourne median of $1,236,000. Median price: $775,000


Preston – Has seen solid growth in recent months, reflected in strong private sales activity (median number of days on market declined seven days in 2015). Located within 10km of the CBD, Preston’s median house price remains well below the inner Melbourne median of $1,236,000. Median house price: $815,000

Epping – Located on the fringe of Melbourne’s middle ring, Epping recorded solid price growth in 2015, driven by a strong private sale market. Poised for further increases in the coming 12 months. Median price: $432,750


Burwood East – A big growth area with extensive development underway at present. While the median house price is high, days on market continue to fall (down from 37 days in 2014 to 30 days in the past 12 months) showing increasing buyer interest. Median price: $1,004m

Montrose – Has a relatively affordable median house price for those buying in Melbourne’s east and has shown good signs of capital growth in the past 12 months (up 10%). A significant drop in median days on market in 2015 (down 11 days to 19 days) has resulted in a strong private sales market. Median price: $600,000

Mount Waverley – Experienced one of the highest median price increases of any Melbourne suburb in 2015, up more than 20 per cent, but should still see growth this year. Attractive to foreign investors and quality local schools (Mt Waverley Secondary College) are also proving to be a key driver for buyers. Median price: $1.38m

Glen Waverley – Middle-eastern suburb which has been in the spotlight in 2015, and will continue in 2016. Given it is zoned for quality public school Glen Waverley Secondary College, buyer demand is likely to continue for the foreseeable future. Median price: $1.319m


Seaford – Bayside and has experienced strong growth in the past six months. Like Sunshine, is also very affordable. Strong private sales activity and clearance rate. Median price: $530,000

Chelsea – Close to the bay and with good transport to the CBD. Saw a strong private sale market and solid auction activity in 2015 as well as double digit annual growth. Should be a solid year ahead. Median price: $727,000

Source: The Real Estate Conversation and REIV

Off the plan loan

Off the Plan – Are you Bear Grylls or Pee-Wee Herman?

Off the plan

Off the Plan Construction &  Real Estate Investing

If you have the heart and soul of a gambler or love extreme sports and activities such as skydiving or bungee jumping then you may be the ideal candidate for off-the-plan real estate investing. Off the plan construction profits are often among the highest in the industry. At the same time so are the risks. You will find the greatest highs and lows that can be found in the field of real estate investing lie beneath the umbrella of off-the-plan profits and many of the big names we know so well in the real estate investing field have made much of their fortunes through speculation and off-the-plan sales.

Before I go any further, one word of caution. While the potential for profits in this particular corner of the real estate market are often high the risks are also abundant. This is speculative real estate at its very best and as we have all learned in the past, when the bubble bursts in a specific market those who have the most invested are the ones who often loose most heavily.

As far as what off-the-plan real estate is there are a few interpretations. The first is also the most obvious. You are buying real estate at some point before construction is complete. In hot markets you will often need to purchase the units before ground has broken on the project in order to get the lowest price for your investment and highest potential pay off for your pockets. Once you’ve purchased the unit or units you plan to sell you then begin seeking buyers for those units. In markets that are on fire it is not exactly uncommon for a property to change hands and have several owners before the unit is complete. Each one will take a little something home from the table for their efforts with those who get in earliest often taking the largest piece of the pie home with them.

You may be wondering why this occurs and the answer really is simple. When the contractors attempt to get funding for their buildings in these large complexes they often need to have a certain percentage of the units “pre sold” in order to convince the banks that there is an adequate market and to garner some of the revenue that is needed to get the venture up and running, so to speak. So real estate investors buy these units at rock bottom prices because essentially they are paying for the idea of the unit (which hasn’t at this time been built and isn’t yet approved to be built in many cases) rather than a brick and mortar property. As the project draws closer to completion, particularly in markets where real estate is in high demand, the value of the property rises dramatically ending in ridiculous profits for those who have managed to hang on.

The risks however are many. There are any number of things that can go wrong on a project such as this not the least of which is that the demand for housing will be met before the unit is actually built. This has happened and continues to happen. Also recessions, business closings, economies collapsing, and tragedies in the vicinity can occur before the property is complete leaving everyone who has invested heavily in the project holding a little bit of the bag and losing their profits and, quite possibly, their investment. These projects generally take a great deal of time to complete which makes the risks that much greater and the anticipation of these events a little more difficult to map out ahead of time. If you can manage to make it through however many investors see large per cent returns on their investment making off the plan a popular type of investment among many despite the rather large risks involved.

Contact one of our specialist lending providers to see if you qualify for an off the plan loan today.

commercial real estate

Commercial Real Estate Investment Strategies

Commercial Real Estate Investment Strategies: Do-it-yourself Market Research Pays

One of the strategies commercial real estate investors like to employ is hiring consultants or market research companies to analyse a specific market a commercial real estate investor wants to pursue.

To a beginning investor, the overall strategy seems logical and well-intended.  Who better to know a market than the analysts who spend their days and nights collecting, analysing and reporting on such data?

I’ll tell you:  YOU—the commercial real estate investor.

There is no substitute for doing your own research.  There is no substitute for keeping your own counsel.  There is no substitute for doing your own homework.


Because it’s YOUR MONEY that will ultimately be spent.  It’s YOUR bank account that will ultimately reflect the success or failure of a commercial real estate endeavour.

Too many well meaning beginning real estate investors think they don’t have what it takes to do the homework required on a market.  Too many well meaning investors yield to their analysis people who supposedly know more about the subject than they do.

This is a costly strategic mistake.

I have nothing against market research people or consultants.  I have no axe to grind with them.  They are extremely competent, thorough people who provide a valuable service.

My issue is with HOW they are used by the commercial real estate investor.

The challenge is when an investor trusts their judgment–more than his or her own.  Many times an investor will be in awe of their command of the information, specifically statistics.

The reason I say this is because I have seen many a real estate investor unwittingly fall victim to this process.  It’s very easy to find yourself yielding to a “professionals” opinion based upon research which you have paid handsomely for.

Don’t.  It is a mistake that will cost you later on.

So what is the proper way to use these market research professionals?  There are three common ways which these professionals are valuable to the commercial real estate investor:

  1. One is as a way to flush out new ideas and do homework and research “heavy lifting” which needs doing that the investor doesn’t have time to accomplish on his or her own.  The investor knows exactly the information he is after.
  1. The second strategy is as a way to confirm the findings which the investor already believes are accurate. In other words, the investor is looking for a second opinion before he commits more resources to the project.
  1. The third strategy is very interesting: Some investor will use professional resources to poke holes in their strategy.  To find the fatal flaw.  To find “the fly in the ointment”.  The investor will never admit this to the professionals, yet he wants to know all the reasons the deal won’t work.

You’ll notice one thing in common with these three strategies:  The investor will always do his own research.  It’s a critical aspect of success—one that should never be delegated.



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investment property

Investment Property – 5 ways to sniff out secret sales

Investment Property - 5 ways to sniff out secret sales

Wouldn’t it be great if you could find an investment property before it went onto the market? We reveal how you can find secret property sales.

If you are a buying property for yourself and want to get access to unlisted properties you need to get clever.

1. Become better friends with your local real estate agent
As the key contact between sellers and buyers, agents are the first to be aware of properties for sale – yet so many people are shy about handing over their mobile number at open inspections.
How are you ever going to be made aware of deals or changes in a vendor’s expectations unless you make contact with the agent? You need to persuade the agent that you are very serious about buying an investment property.

Make sure they know you are pre-approved for finance, are serious about buying and can make a quick decision followed by a signed, unconditional contract.

People are often scared about telling an agent what their budget is, as they think the agent will make them pay more. I always say that I can buy up to any amount if it is the right deal, but I am only prepared to pay what it’s worth – and I will get an independent valuation to double check the figure.

2. Letterbox drops
Do what the agents do and letterbox drop in the areas you want to buy.

If you are a serious buyer for the right investment property, the vendor can save time and money by going directly to you. It takes more personal effort and will cost you some money, but spending a few hundred or even a few thousand dollars could get you a great property at a great price.

A lot of vendors always think their property is the best in the street and want a fortune for it, but some do not keep up with the market and want something more realistic.

3. Get organised
Make sure you are ready when the right deal comes along. Get pre-approved for finance and have your valuer, building inspector and strata inspector all in place so they can check you are buying the right property at the right price.

You are never 100% guaranteed of any deal when it happens, so at some point you have got to make a decision and jump in. The more organised you are, the more likely that decision will become easier.

4. Tell friends, family and colleagues you are looking to buy
Often those close to you will know of someone else looking to sell, so spread the word. People love talking about property, so if you mention you are looking every time you talk to someone it won’t be long until you make the right connection.

5. Pay a professional
If you buy an investment property once every few years and a buyers’ agent does it every day and has all the industry contacts, who do you think will buy better? Sometimes you’ve got to spend a dollar to make two.

To discuss this article or anything to do with your finances, please call our office today and we will be happy to assist you 0434 087 735 e: [email protected]