Biggest Mortgage Hack! Interest Only vs Interest + Principal | $1,000,000 Equity
HTML-код
- Опубликовано: 25 май 2024
- HOW CAN I HELP?
🏠 Book Your FREE Call
www.searchpropertyau.com.au/b...
🏠 My Buyer’s Agency
www.searchpropertyau.com.au/
🏠 Email me 👉 ravi@searchpropertyau.com.au
As Featured on:
AFR, Sunrise Show - Channel 7, Channel 7 News, Business News Australia
“REB’s Best Buyer’s Agency 2024 - Finalist”
“REB’s Best Buyer’s Agency 2023 - Finalist”
“REB’s Rising Star 2023 - Finalist”
“Australian Financial Review’s Fast Starters 2023 - Top 100”
“Young Entrepreneur Awards 2023 - Finalist”
“Australian Small Business Champions Awards 2023 - Finalist”
FREE CRYPTO BONUSES
🇦🇺 CoinSpot - Buy Crypto + get $10 free BTC 👉 bit.ly/Coinspot-SP (Referral Code) 👉 QFMKHN
🏠 My Online Course - Step-by-step guide to buying your first property
www.searchpropertyau.com.au/o...
✔️RUclips Collabs/Sponsorships 👉 personalfinancewithravi@gmail.com
JOIN THE COMMUNITY
🇦🇺 Join the Private FB group (FREE) 👉 / 361198781729010
⏰ MUST WATCH VIDEOS 👇
👉How To RETIRE EARLY in Australia - • How To RETIRE EARLY in...
👉How to make $100,000 passive income - • How many PROPERTIES do...
👉My Multi-Million Dollar Portfolio Revealed - • My Multi-Million Dolla...
👉 How much passive income I make? - • Passive Income Austral...
DISCLAIMER No Legal, Financial and Taxation advice
The Listener acknowledges, consents and agrees that:
• The Listener’s access to and viewing of the content presented on the Channel is subject to this
Disclaimer and you agree to be unconditionally bound by this Disclaimer.
• Any information provided by us is conveyed as general information and for general information,
educational or other non-advice related purposes only.
• We have not taken the Listeners’ personal and financial circumstances into account when providing
information.
• We must not and have not provided legal, financial, investment and/ or taxation advice,
recommendation, or guidance to the Listener.
• The information provided by us must be verified by the Listener or an independent professional
advisor including a legal, financial, taxation, accounting or other relevant advisor prior to the Listener
acting or relying on the information.
• The information may not be suitable or applicable to the Listener’s individual circumstances, needs,
objectives or financial situation.
• All information and content provided by us is given in good faith and has been derived from sources
believed to be accurate. However, the information is selective and may not be verified by us.
Information provided by us on this Channel may not be complete or accurate for your purposes and
we make no representation or warranty of any kind as to the accuracy or completeness of the
information provided. It is general information only and should not be relied upon for any purpose.
• We do not give any warranty of reliability or accuracy nor do we accept any responsibility arising in
any other way including by reason of negligence for, errors in, or omissions from, the information on
this Channel (whether under law, contracts, or torts) and we do not accept any liability for any
expenses, losses or damages, however caused, directly and/ or indirectly as a result of any person
relying on any information on this Channel or being unable to access this Channel. You expressly
agree that your browsing of this Channel is entirely at your own risk.
• We do not hold an Australian Financial Services Licence as defined by section 9 of the Corporations
Act 2001 (Cth) and we are not authorised to provide financial services to the Listener, and we have
not provided financial services to the Listener.
• You agree that Australian Law will govern this Disclaimer and the Channel. Any dispute arising out of, or in connection with the Channel will be subject to the exclusive jurisdiction and venue of the
federal and state courts within Australia.
passive income from property
Australian property investing
Australian property market update
interest rate changes
cashflow positive properties Australia
This strategy is not for everyone due to the following reasons :
You will still be paying interest on the loan, which can add up over time.
If property values go down, you could end up owing more money on your loan than your properties are worth.
You may not be able to refinance your loan after the interest-only period ends.
However, if done right, it is the most leveraging option one can have. 😊
I personally do it in hybrid mode. Part fixed rate interest only, and part variable. Paying down the variable part little by little and refinance every year to shrink down the interest rate only part.
This is what I used 20 odd years ago. Back then interest only loans had a 15 year term then reverting to a P&I loan. The idea was to buy 2 properties that would go up in value more than the cost of holding them. After 15 -20 years sell one to pay of the other and you saved 10-15 years in owning the property.
Down side is if you don't sell one to pay off the other payments are high due to now only having a 15 year P&I loan to pay the balance. But now I know how inflation helps those with assets the remaining debt is not much in todays money.
Awesome explanation 👏👏 Where can I get the calculator that you are mentioning here ?
Just a little critique. The comparison wasnt done completely. What were the total interest repayments at the end of 30 years + the initial loan amount. Then compare the p & i vs interest only.
What if the market will not facilitate capital growth and flat lines
Yeh, like others here, i can't find a lender where the P&I rates versus the interest only rates are such that you pay less on interest only. i can only find ones where you pay more on interest only for the exact same loan. Can you please explain Ravi. what am i/we missing?
You don't make principal payments only interest. Therefore your payments are less.
@@thedon9670 yeh. You didn't read what I wrote. In any event. I've found some that do.
I appreciate the effort in the video but bro you went from talking about more cash flow on I only on a 600k property to suddenly talking about buying and selling 2x 700k property. 🤣😅
Can you share the links to your calculators, please?
i was thinking that as well calcs look good
Im 30 now and in 30 years i’ll be 60. I’ll have millions in my bank account but will be dying soon.
Is it worth it? Did you enjoy your life?
I know lots of people with $1M loans paying $65k of interest a year with current 6.5% interest. (There are almost dying as well and they will endure that for 30 years.)
Money and having lots of properties will not give you happiness if you trade your life for them. I work with dying people so I know where all of us will end up.
My suggestion is, live within your means. Buy a small house that is just enough for what you need. Pay off your debts early and enjoy your life. ❤
I love your message it’s true and that how we should do. Also invest in some index fund or maximum your super contribution for good retirement
This just needed more than a thumbs up. Thanks for the humble message mate
I reckon you can do both a the same time. No issues hustling for your kids future a bit
11:20 add your tax bill to that amount and you’ll need to hold for a few more years
exactly.. 22.5% CG tax considering 50% discount since held for more than a year. Regardless, idea to find investment property with value growth plus rental returns compensating for the interests paid
Doesn't add up at all, interest only loans have higher rates. Also being "filthy rich" in 30 years from now is actually a shit life, my money is worth way more to me when I am younger than having a 1% level of filthy richness when i am old
The difference is marginal between interest only and p+i. Principal payments are way more than that marginal increase in interest for interest only.
As for your second point, you shouldn't invest then.
But your increasing your income with positive cash flow ?
In the short term
Interest only and negative gearing means repayments on the investment property can be turbocharged...
Awesome video Ravi, totally agree. Only thing is interest free loans are typically at a higher rate compared to P&I, something to consider when you compare the two options.
So does that mean, the video is complete BS as it is not freeing up the cash in hand to buy another property?
Yes, just remember to note to new investors $1,000,000 in 15 years is more like having $633,000 today.
Yeah but if capital appreciation is greater than inflation, you're still coming out ahead.
I'm not sure that Ravi is aware of all the figures which need to be included in such an analysis. In Victoria there are taxes each year on investment properties. Capital gains tax needs to be paid on the sale of the investment property.
What about how interest only reduces your borrowing capacity
Does it? Can you please tell me how
I don't agree to this, doesn't make sense, IO reduces your borrowing, so you still can't buy more IP
You are the 99% that's why.
Sound advice. Glad you sacked your previous previous video editor, way easier to watch!
I lost over $70k when everything started to tank. Not because I was in an exchange that went belly up. I was just stupid to hold and because that's what everyone said. I'm still responsible. It just taught me to be a better investor now that I understand more of what could go wrong. It took me over two years of being in the market, I'm really grateful I found one source to recover my money, at least $15k profits weekly. Thanks Patricia Annie Brooks
I'm surprised that you just mentioned Annie Brooks here also Didn’t know she has been good to so many people too this is wonderful, i'm in my fifth trade with her and it has been super.
You trade with Annie Brooks too? Wow that woman has been a blessing to me and my family.
YES!!! That's exactly her name (Annie Brooks) so many people have recommended highly about her and am just starting with her from Brisbane Australia🇦🇺
I'm new at this, please how can I reach her?
Her good reputation already speaks for her .I’m also one of the beneficiary of Annie Brooks. So happy I gave it a trial after being skeptic of the process.
Perhaps a query, are we really facing an Aussie housing market where in 30years a property will cost $6-8million? 😮😢
Perhaps the return figure was too high, you did say 3 - 6% towards the end. I think the $8million figure lost me but I really value the mindset of being debt accumulation phase to acquire assets vs debt reduction. It is helpful to framework.
30 years ago properties were $60,000 now they're $600,000. In 30 years they will be $6m. It's the way the world works.
Interesting only is only for 5 years
Is the interest tax deductible?
Of course
I believe if you're not living there and you're renting them out then yes the interest rates can be deductible. I would check with a financial advisor though.
What percentage of the interest do you get back?
@@cindymajdak6622 You can claim all the interest paid with an investment property.