loans

Mortgage Insurance or Lenders' Mortgage Insurance (also referred to as LMI) is the insurance that a lender takes out in case you, the borrower,  default and they have to sell your property used as a collateral.  

Mortgage insurance is based on a projected shortfall between the debt amount and what lenders think they could get for your property. Mortgage insurance can also be capitalised into the loan. Mortgage brokers usually cannot apply for mortgage insurance contracts.  

In order to borrow, the following are required:

• Last 2 consecutive pay slips – all applicants

• Last 2 years tax returns – Personal

• Last 2 years company tax returns, P&I and balance sheets – Self Employed

• Last 2 years group certificates

• Last 2 years Tax Assessment Notices

• Letter of employment: date started, job description, employment status, base wage, YTD earnings

• 6 months current home loan statements – all loans

This part explains the steps required to allow a SMSF to purchase real estate and borrow. The process is represented diagrammatically at the end of this part.

1. Establish/review the SMSF

(a) The Trust Deed establishing the SMSF must give the Superannuation Fund Trustee power to:

• Purchase real estate,

• Borrow money, and

• Mortgage property to secure repayment of that borrowing.

How does my SMSF purchase a property?

The SMSF chooses the property it wishes to invest in, in the ordinary way. Residential property must be purchased from an arm's length vendor. Non-residential property can be purchased for full value from "related vendors" so long as the property is let for business purposes.

The Contract for Sale to purchase the property must be entered into in the name of the Property Trustee (as owner of the legal interest in the property).

You can start packing your own lunch, and you can forgo going out to lunch with your friends once a week (both may be sensible steps to take), but before you start clipping coupons, look for some painless ways to reduce your expenses. Briefly audit your credit card statements and monthly bills to identify items you don’t need, and may not even realize exist. For example: