Sydney teacher Monica Rouvellas shares how she bought three homes on a $70k wage

Despite earning “too little” to secure a loan, Sydney music teacher Monica Rouvellas successfully navigated several banking obstacles to acquire three homes valued at $1.2 million.

With an income of $70,000 a year on top of the fact she was self-employed, the banks assessed her ability to pay the loan at only 60 per cent of that income, leaving her with minimal money to take out.

However, Rouvellas told realestate.com.au that she resolved this obstacle through a special purpose vehicle. It is essentially a company she set up for her property deals and it has meant the banks assessed her risk differently and were able to lend her more than she would have got applying for loans personally.

She has also joined forces with her brother. Together they went 50/50 on the loan and upfront costs, buying their first unit for $350,000 with a 10 per cent deposit.

Since acquiring two more homes, she has managed her finances so effectively that her total debt on these properties stands at approximately $500,000, leaving her with approximately $700,000 in equity.

Remarkably, the rental income from these properties nearly covers her mortgage payments, reducing her out-of-pocket expenses to a minimum.

“One thing I learnt is that banks treat you differently if you take out lending products as a business,” Rouvellas told realestate.com.au.

“The banks’ risk appetite is different. You have the backing of the Corporations Act so the banks have more alternatives if things don’t go well. You also get more asset protection benefits and there’s more ways to minimise your tax.”

Stressing the importance of buying in the right place at the right time, Rouvellas added: “I do a lot of research to look at which areas are going to grow and where the rents will be high.”

“My advice for anyone (investing) is to get advice on structuring your loans. It makes all the difference,” she added.

Source: Realestate.