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Cash Flow Manager
Make your cash flow positive from day one!
Repayments from just 6.96%!
What is the Cash Flow Manager?
Traditionally property investors have to endure cash flow shortages for many years until rental returns eventually catch up with interest repayments. As such, investors end up having good assets but poor cash flow and their lifestyle suffers.
The Cash Flow Manager (CFM) is an innovative product that delivers a positive cash flow on negatively geared investment from day one.
This is achieved by a reduced interest rate being applied over the first five years. The difference between the reduced rate payable and the standard interest rate is capitalised to the loan principle, thereby reducing the monthly repayment which enables investors to obtain a positive cash flow from their investment.
The CFM is available for both commercial and residential property on a 2, 3 or 5 year reduced rate term - maximum borrowing up to 85% with capitalisation up to a maximum of 95%.
Standard Investment Mortgage
Example of a standard investment mortgage with an interest rate of 7.65%, assuming 8% capital growth per annum and tax deductions on interest at 30%, giving you a negative monthly cash flow from day one:
| Year | 8% Capital Growth pa | 4.5% Rental Income pa | Mortgage Balance | Mortgage Repayment pa | Monthly Cash Flow |
|---|---|---|---|---|---|
| Start | $500,000 | N/A | $400,000 | N/A | N/A |
| 1st Yr | $540,000 | $24,300 | $400,000 | $30,600 | -$375.00 |
| 2nd Yr | $583,200 | $26,244 | $400,000 | $30,600 | -$254.00 |
| 3rd Yr | $629,856 | $28,343 | $400,000 | $30,600 | -$131.00 |
| 4th Yr | $682,044 | $30,611 | $400,000 | $30,600 | $0.27 |
| 5th Yr | $734,664 | $33,060 | $400,000 | $30,600 | $3.50 |
Cash Flow Manager Mortgage
A comparative example of the same investment property using the CFM shows how you can make your cash flow positive:
| Year | 8% Capital Growth pa | 4.5% Rental Income pa | Mortgage Balance | Mortgage Repayment pa | Monthly Cash Flow |
|---|---|---|---|---|---|
| Start | $ 500,000 | N/A | $400,000 | N/A | N/A |
| 1st Yr | $ 540,000 | $ 24,300 | $415,432 | $18,551 | $748 |
| 2nd Yr | $ 583,200 | $ 26,244 | $428,512 | $24,474 | $398 |
| Rollover* | |||||
| 3rd Yr | $ 629,856 | $ 28,343 | $438,254 | $19,743 | $939 |
| 4th Yr | $ 682,044 | $ 30,611 | $442,657 | $25,546 | $600 |
| 5th Yr | $ 734,664 | $ 33,060 | $442,657 | $30,101 | $366 |
* A CFM Rollover can be used where capital growth on your investment property exceeds 4.5% per annum for two years.
To find out how you can have an investment property that returns a positive cash flow from the very first day, enquire now!