Short YouTube monologue (by Aaron Whybrow, Feb 3, 2023) explaining cross-collateralized property loans using a client case study: two recently settled properties were used as cross-collateral security, which blocked access to equity once construction began. The presenter describes refinancing to split the loans, accessing equity, setting up offset accounts, and enabling purchase of an additional property; ends with a call-to-action and phone contact.
Questions this video answers
029-188-4488
Hey guys, I've just been working through another client here where initially they came to us because they wanted to buy quite a large piece of land. So as part of the interview process, I was just asking them, you know, how many properties have they got? So they were talking to me that they've got two properties that they just settled on and they wanted to access the equity. So they didn't have enough cash in, in their actual bank account. They wanted to use the equity in their home to be able to complete that first purchase. So it sounded to me like it was what we call as cross collateralized, which means that you've got two homes, that is securing the whole loan. So what does that actually mean? Well, in this particular scenario, one of the properties is going to be constructed. So what does that mean for that particular customer? It actually means that once the construction process is actually started that it actually locks out their access to equity. So what we have to do is just understand that. Was that actually the case? And yes, that was. So what we had to do was then refinance their loans to be able to split them out. So what that means is, is that we can access, we can access the equity from over here. So then, you know, when we can, we want to start construction, that means that, you know, they can't not access that extra money. So yeah, we made that happen for them. And we also set them up with a couple of offsets as well. So they got the extra cash out so they could buy that next property and they could offset it against their existing portfolio. So if you have anything like that, where you've got a couple of homes and you want to access equity, you want to do construction and you want to double check what the structure is looking like, anything like that, do give us a call here. We will do our best to find out what the right solution is for you. So give us a call here on 029-188-4488.
