Some Advice needed

I purchased a 2BR unit in Rockdale 1 1/2 yrs ago for 390K
My credit rating was bad at the time so I had to buy it in my gf’s name. Unit is worth about $370k now for a bank sale, we owe 394k on the mortgage including 7k of arrears. Payments are about 3k per month and we rent out lounge room + second room inclusive of bills reducing payments to 2k per month.
We have negative equity, 7k arrears, 4k of strata owing, council rates and little prospect of capital gains

Whats the process in a bank forclosing on a mortgage? We were close a few months ago, to the stage of them getting a realestate agent around to make a valuation, we scraped up some cash and its no longer in default but is 70 or so days behind again.


I develop software and bring in around 70k clear per year growing fast now with unlimited potential. My gf has not been working but we have just purchased a small restaurant in the city that she will run. We will be 50/50 in the business.

I need a financial advisor to fit all this together in a tax effective way any recommendations? I want someone that I pay money to and I wont get into any investments they make a cut on.

But please if anyone can give me some advise, here are my options as I see them,

1. Sell the place, What does a bank do when you sell a property and can not give them all there money back?

2. We lease the Restaurant at $750 per week and it has a 3br residence above it, we were going to rent them all out but we could live in one and then turn this unit into an investment property.

3. Stay here and claim some of the unit as an investment.

The unit at the moment just seems like a drain on finances that could be used more effectively in my existing business and the new business, I would like to keep it for some illogical reason but I cant see the point of tipping over 30k a year into it.


Cheers,

 

Is the property located at 555 Princess Highway.

Just becuase thats what its valued at doesnt mean thats the sale price youll achieve...

First question would you get a better overall return renting the whole unit out and living above the business? Or will you get more money keeping status quo and renting out the 3 bedder...

 

Not 555, I dont really want to give away my adress on the net, there are plenty of newish units around here, someone is trying to get rid of one here same size same views for 420k, they wont get anywhere near that the agent said. yeah a bank may get rid of it for 350, seems like properties here stay on the market for ages.
Could you see Rockdale even averaging 4% over the next 10 years? acording to free online reports its done 1% in the last 5 years

With the 3 bed I could get 500 total for two of the rooms and the other that we would be using is very small maybe 100. Rockdale total rent as it is could be $480. looking at it I guess Im answering my own questions, we need to rent everything out, live in a tiny room and cook seafood for a while, hehe

Do you know about the stages of mortgage default, should I be safe staying under 90days behind?

 

Yep i can... Resedix is actually predicting 6%+ growth this year, and next year....

I only know coz 3 months ago i bought a unit there, and have an offer accepted for another brand new unit with a 5.7% yield....

20 Byrant St has good views, is only 2 years old but looks about 8. There is one list for about 420 but is worth only around 370 in my opinion. Rockdale Plaza Drive is the other place however there 10 years old and on top of a shopping centre, listed prices are a joke when you see what they sell for (via rpdata report). There seems to be about 13% discount on the properties.

555 Princess Highway have many units for sale as it was built in 03 where people paid top dollar. Sellers dont understand the area has dropped (along with most of sydney) and its now worth less than they paid (in addition to buying something brand new and selling something 5 yrs old)

Eastern Rockdale is running out of space to develop. Its bound by George St and theres very few blocks left which can be developed (there is one of bound by King, Market and Pitt however block is quite narrow but is long). Western Rockdale is a very different story, id estimate average age there is min 15 years old.

Ive heard 90 days was a magical figure however i can comment as to the correctness of it.

 

Well whether or not you default is only part of the problem. Future lenders might have a problem with someone who skates so close to the edge.