MORTGAGE CUTTER Transform your mortgage Into a business opportunity

This information was produced as an information service and without assuming a duty of care. It contains general information only. It does not constitute financial advice and should not be relied upon as a substitute for financial or professional advice.

This Presentation does not take into account any persons particular objectives, needs or financial situation. Before making a decision regarding the acquisition or disposal of a financial product persons should assess whether the product is appropriate to their objectives, needs or financial situation. Persons may wish to make this assessment themselves or seek professional advice. No responsibility is taken for persons acting on the information provided. Persons doing so, do so at their own risk.

It is a requirement that all prospective investors are required to obtain competent legal professional advice or be represented.

Save $’000’s of interest

payments

Take years of

your loan

Control of the term and cost of your

mortgage

Accelerates property

ownership

Provides financial

protection

A NEW WAY TO:

1

2

3

4

5

6

7

Make more frequent payments

Choose a loan with offset or redraw

Put your salary into your offset account

Use a credit card program

Shop for low rates and or fees

Pay extra amounts

Put your tax return into your loan

INCREASING EQUITY

PRINCIPAL & INTEREST

INTEREST ONLY

Loan Term

Loan amount

30yrs

INTEREST ONLY Loan

amount

30yrs

Equity + Mortgage Cutter

Typically 10 – 20yrs

Loan Term

Guaranteed Income

12%

$375,618

$190,062

11.92

18.08

Making your mortgage WORK for you by using the equity in your mortgage to reduce your Loan

Profit Share Income

26%

$604,646

$313,408

20.42

9.58

Mixed Income

18%

$510,517

$261,983

16.92

13.08

Initial Loan $400,000 Current Loan Balance $375,000 Available Equity $25,000 Interest rate (%pa) 6.00% Initial Term (yrs) 30

Choice of Income: (Paid monthly)

Typical Rate (%pa):

Payments Saved

Interest Saved

Years Saved

Loan Term (yrs)

Pay off the home loan sooner

Gain positive cash flow from residential investment property

Meet property running expenses

Provide a mortgage repayment buffer

Proof of direct ownership

Sole purpose test

Monthly income

Certainty of value

Tax-effective

USE PASSIVE BUSINESS INCOME TO SUITABLE FOR SMSF

The net monthly additional income from their using Mortgage Cutter strategy will reduce their loan term by approximately 11.5 years and save them about $110,000 in interest without adversely impacting their life style.

After considering a number of mortgage reduction options, they chose the Mortgage Cutter strategy as it did not adversely affect their cash flow from their existing incomes.

A couple have a $240,000 loan over their property and $80,000 available in their offset account and are interested in reducing their mortgage.

STRATEGY OUTCOME

Establish a $440,000 loan with offset account.

Pay out $120,000 personal debt.

Apply balance of loan to a Mortgage Cutter strategy earning 18% pa.

Apply the net monthly passive business income to repay the loan and re-invest (compound) the increasing amounts in the Mortgage Cutter Strategy.

STRATEGY OUTCOME

Pam, a single mother aged 50 needed $120,000 to repay a private debt. She owns an unencumbered property valued at $550,000.

A 15-year, 6.00% pa $120,000 loan required $1,041pm repayments. Pam wished to minimise her monthly cashflows.

Option 2: Same as Option 1, but continue the Mortgage Cutter strategy for another 7 years, and earning $6,520pm passive ongoing income.

Option1: Repaying the $120,000 personal loan in 3 years with no monthly repayments from personal income and discharging the loan in full using the 3-year capital buy back provision, or

With appropriate professional advice set up a SMSF

Arrange an 80% LVR SMSF loan Purchase a $400,000 investment property + Mortgage Cutter package

STRATEGY OUTCOME

A Couple in their mid-50’s with 2 young teenage children wanted to be financially independent by age 65. Their main asset was almost $200,000 in super.

Initial package income of $336.00 pw positive cashflow

Return on Investment (ROI) of 20.43%pa

SMSF loan fully repaid in 10 years

Ongoing rent + Mortgage Cutter strategy income

MORTGAGE  

EQUITY AND/OR

AVAILABLE CASH

DESIRE TO RUN YOUR MORTGAG

E AS A BUSINESS

Brian Fincham Ame-x Mortgage Management

M: 0400 303 572

E: brian.fincham@ame-x.com.au