In property investment, is it true that the longer the loan tenure, the better it is? It is up to individual investment strategy.
Under current Bank Negara policy, one can borrow up to 30-35 years.
What if we are already in 40’s to 50’s? That means our loan tenure is around 15 – 25 years loan tenure only.
If loan tenure is shorten, mostly the rental cannot cover monthly instalment.
In our JV platform, we have a system that can help us to always find proxy, who is 20’s or 30’s as they are able to borrow loan up to 30 to 35 years.
Eg a 50 years engineer, have 5 properties.
Fund available: RM500k
Loan available: loan tenure max 15 years only at 70% LTV
Eg a 25 years fresh grad, haven’t own any property yet.
Fund available: 3k
Proxy available: two LTV 90% slots, loan tenure max 35 years at 90% LTV
HOW? They can form the perfect JV partner: one come out with fund, another one come out with proxy.
If we have found a good deal,
For example:
Project: SR Apartment, Bandar Kinrara 5, Puchong
Purchase price: RM320k
Bank value: RM380k
BMV: 16%
For RM380k property, we need to prepare the following fund:
1. 10% downpayment: RM32k
2. Legal fee (SNP and loan) @ SNP price (RM380k): RM14.7k
TOTAL : RM46.7k
If owner is kind enough and understand, and allows us to mark up the purchase price to bank value price, then we are allow to use the bank value price to apply loan (We will share with you is it good to do this in coming session)
We need to pay the 10% downpayment, RM32k first, only we can get back our fund
After 3+1 months, we will get back the cash out
To calculate cash out:
cash out amount = 90% of bank value – 90% of purchase price
= 90% of RM380k – RM90% of 320k
= RM342k – RM288k
= RM54k
After deduct the total fund, we still have additional RM7.3k cashflow
Nett cash out = cash out amount – total fund
= RM54k – RM46.7
= RM7.3k
We might think that, only 54k, after 3+1 months can get back already, why do people still want to JV with us to buy property?
The fact is that if we dont have RM10k, we really don’t have 10k, don’t said 54k.
There are a lot of Gen Y between 20’s to 30’s will want to work together and JV with you.
Reminder:
To do NMD, we have to get experienced lawyers to do, and got to make sure:
1. One set booking form for RM320k purchasing price is for owner
2. One set booking form for RM380k bank value price for loan application is for banker
When pass to banker, is RM380k booking form, not RM320k booking form.
And of course, the SNP in at RM380k
Will You Share if Someone Come To You and Ask You, Can You Teach Me ow To Do NMD deal?
We will teach you in next session!
