Join our investing community

Buying a home without a income?

Discussion in 'Real Estate' started by Zman, 21st Aug, 2008.

  1. Zman

    Zman Well-Known Member

    Joined:
    3rd Jul, 2007
    Posts:
    54
    Location:
    Sydney
    I know this is kinda a stupid question but here goes.

    I recently stopped working after 3 years at my previous job. I am currently studying so have no income other than interest from my bank.

    I have a substantial amount of cash enough for 40-50% of a medium priced house in NSW.

    Now if i was to deposit that amount would they consider having a guarantor (parents) co sign with me even if i dont have a income? I would still like the house to be under my name though.

    Also i was wondering too, if i was to buy a unit would it be better to pay for it outright or do the normal 20% as i do plan to turn it into a investment property after 6 months. If i do the 20% i would have the same problem with no proof of income.
     
  2. Simon Hampel

    Simon Hampel Co-founder Staff Member

    Joined:
    9th Jun, 2005
    Posts:
    4,619
    Location:
    Sydney, Australia
    Do you actually have enough cashflow to be able to service a loan?

    If you don't it's kind of a moot point - no point taking out a loan if you can't afford to pay it back (or at least pay the interest costs) ??
     
  3. Zman

    Zman Well-Known Member

    Joined:
    3rd Jul, 2007
    Posts:
    54
    Location:
    Sydney
    Yes i will have enough cash flow to service the loan for about 1 year. Im planning to only be studying for the next 6 months or so, will find another job after that period.
     
  4. Zman

    Zman Well-Known Member

    Joined:
    3rd Jul, 2007
    Posts:
    54
    Location:
    Sydney
    My other thought would be the buy a unit then use that equity to finance a house?
     
  5. 02bsure

    02bsure Well-Known Member

    Joined:
    11th Nov, 2007
    Posts:
    136
    Location:
    cologne
    speechless ....it must be a wind up.
     
  6. AsxBroker

    AsxBroker Well-Known Member

    Joined:
    8th Sep, 2007
    Posts:
    1,448
    Location:
    Sydney, NSW
    Hi Zman,

    Go to a local mortgage broker and they will be able to discuss with you in more detail.

    Cheers,

    Dan
     
  7. crc_error

    crc_error The Rule of 72

    Joined:
    1st May, 2007
    Posts:
    1,367
    Location:
    Melbourne, VIC
    just say your buying the property for investment and it will have a tenant.. tenant income will be counted, and since you have 50% deposit, there will not be a problem.
     
  8. Billv

    Billv Getting there

    Joined:
    15th Jul, 2007
    Posts:
    1,796
    Location:
    Sydney, NSW
    Zman
    Answers in red


    I'd borrow 80% and leave the rest of the money in an 100% offset account.
    (That's if the lender agrees to give you a loan with an offset)
    Start by talking to a broker and/or the banks.
    Don't give up if the first lender says no, try the next 1.

    Cheers
     
  9. 02bsure

    02bsure Well-Known Member

    Joined:
    11th Nov, 2007
    Posts:
    136
    Location:
    cologne

    So your advice to this man is to commit fraud.

    Heres my advice (which to me at least is nothing more than pure common sense) -

    1. Finish your 6months of study.
    2. Get a job.
    3. Settle into said job for 6mths minimum.
    4. Consider to buy a property (if you must).
     
  10. crc_error

    crc_error The Rule of 72

    Joined:
    1st May, 2007
    Posts:
    1,367
    Location:
    Melbourne, VIC
    what is fraud about it? he said he plans to make it a IP in 6 months time, I'm sure with all his cash, he will be able to cover his loan for 6 months.

    A bank doesn't ask when you plan to make it a IP. You tell them your putting down x deposit, this is the rental return potential, and you have no income.

    I know heaps of people who have purchased IP without jobs or simple casual jobs.

    When you present to the bank 20%+ deposit, then they are not so worried about your servicability. let alone 50%