Client Case Study

Purpose

Our clients decided that they wanted to get ahead financially and pay-down their mortgage over the next 5 years. They knew this must be done as early in life as possible, during their prime working years while they can still qualify for a bank loan at competitive rates.

Situation

Our Discovery Session revealed that Ben & Rebecca have been stuck in the mortgage trap for the last 8 years. They originally purchased their family home for $600,000 and it is now worth $980,000. They were lucky enough to have a strong deposit of $260,000 when they purchased and $367,000 mortgage. They now owe $480,000 because they used their equity uplift to do renovations on the property i.e., swimming pool, new kitchen, and a nice overseas family holiday. They had an extreme case of financial cancer and have no solid plan to pay-off this debt other than to work really hard for the next 30-odd years.

Strategy

As part of our investment process, we sat down with our client in a Strategy Session and showed them how it is possible to make $300,000 in capital growth on a right investment property over the next 5 years. We also pointed out that if structured correctly, it will cost them nothing out of their pocket to do it.

Solution

At our Solution Session we presented a Duplex Property Solution that matched their comfortable purchase price of $650,000. This option provided two sources of income and a boosted yield a 6.5% pa.

Outcome

Our clients were thrilled when their investment property grew to a value of $900,000 in just over two and a half years. While being positive cash-flow the entire time and costing them nothing out of their pocket. In fact, they got additional income each week from the property. They decided to sell this property and realise their profit and able to pay $200K off their mortgage. By paying down their mortgage in such a way, this allowed them to increase their borrowing capacity to be able to buy two more investment properties to continue their strategy of curing their financial cancer.