An Interview with LeoT

[Terry_w]

That's why you want to set it all up early to avoid the 3 year threshold. It's interesting that 'failure to act' comes under the same heading.

Regarding the 2 children. I suspect that the problem is the other 2 spouses. I I would feel that as long as there is more than enough income then the beneficiaries shouldn't want to break up the assets. Having said that look at what is happening Gina Rinehart and you would think there is more than enough 'income' available to satisfy the whole family.

Cheers

Sounds like you have a little knowledge which is very dangerous in this situation.

What 3 year threshold are you talking about? Transfer of property 3 years before death probably. But having a power of appointment over a trust is enough for the trust assets to be 'attacked' no matter how long ago the trustee purchased the property.

Also sounds like you are not sure how trusts operate. I was talking about 2 children, especially under 18 and of different ages. What if one child turned 18 and became the appointor while the other child was say 16? What could happen...think about the capital and discretionary powers of the trustee.

2 spouses would also be a issues as it would be very unlikely that a surviving wife would distribute to the deceased's mistress or new defacto wife and vice versa.

Also I forgot to add above that the family law act gives the courts to make orders against 3rd parties such as trustees and can countrol trust assets as a financial resource of the parties.

Trusts are generallly good to protect against creditors in bankruptcy of a beneficiary but there are a whole lot of other assets protection issues to consider.

And we should make this a new thread so as not to infringe on LeoT's interview discussion. see http://somersoft.com/forums/showthread.php?p=1245730#post1245730

 

[LeoT]

All serious investors/developers i know organise the finance themselves. Then again, it depends on what your definition of serious is.

Oscar

Hi Oscar,
I was mainly referring to investors for ips. Especially new investors. I definetly think it's not in alot of new investors best interest to try and negotiate with the banks themselves. That's my opinion.

Cheers
Leo

 

[Blacky]

Outstanding interview!
Heaps of "take home messages" which can be applied to anyone.

I like your comments regarding increasing income, I personally believe this is commonly overlooked.

Kudos to you!

Blacky

 

[LeoT]

Outstanding interview!
Heaps of "take home messages" which can be applied to anyone.

I like your comments regarding increasing income, I personally believe this is commonly overlooked.

Kudos to you!

Blacky

Hi Blacky,

Thanks for your comments. You are so right about income! You know, this is something that's not stressed enough. If someone wants to build a portfolio fast, actually borrowing power is probably the most important thing I can think of. Deposits can come in the form of equity, but without strong borrowing power...its going to slow the acquisitions down a lot. Your right when you say its overlooked. I think its conveniently overlooked by many companies promoting 'retire in 7 years on 100k income' etc.

Cheers

Leo

 

[Redom]

Hi Blacky,

Thanks for your comments. You are so right about income! You know, this is something that's not stressed enough. If someone wants to build a portfolio fast, actually borrowing power is probably the most important thing I can think of. Deposits can come in the form of equity, but without strong borrowing power...its going to slow the acquisitions down a lot. Your right when you say its overlooked. I think its conveniently overlooked by many companies promoting 'retire in 7 years on 100k income' etc.

Cheers

Leo

This is a great point and one that I find people often don't appreciate.

Many clients walk through the door with very lofty aims in property accumulation (haha although not relative to you Leo!). The most common view is 'deposits' being the limitation. While that may be true in the short run, over a medium term period, its rarely the problem that stops someone from growing.

The obvious wall is serviceability. It can be delayed with decent structuring, but without income increases, the wall will be hit sooner rather than later.

Great dedication to do what you did Leo. Its great that you realised what you wanted so early - definitely makes a big difference.

 

[Hodge]

All serious investors/developers i know organise the finance themselves. Then again, it depends on what your definition of serious is.

Oscar

Why wouldn't you use a mortgage broker? As long as you've got a good one that you can trust and knows their stuff it would free up a lot of time and hassles.
I know for a fact without my broker I would be stuck at 2 ips.

 

[oc1]

Why wouldn't you use a mortgage broker? As long as you've got a good one that you can trust and knows their stuff it would free up a lot of time and hassles.
I know for a fact without my broker I would be stuck at 2 ips.

Hodge, I'm mainly referring to commercial lending. I believe Leo and yourself are referring to the basic buy and hold type finance. I have used brokers for the latter approach, recently in fact (refinance). They definitely excel at this type of lending. With the former, ie commercial, i have always dealt with banks direct and have had greater success. I prefer ringing the bank/relationship manager direct, putting up the proposal and getting a response within a few days (and not always subject to Credit approval). I know a couple of other SS forum members that have the same approach and wouldn't change it. It's a great set up. A blanket statement about sourcing your own finance being a waste of time is therefore ill informed.

 

[Hodge]

Fair enough makes sense to me. I'm guessing brokers probably wouldn't want to work with developers. There's a high chance the loan would be paid off and closed within a couple years or much earlier if it's a small development meaning claw back of commission.

 

[oc1]

Fair enough makes sense to me. I'm guessing brokers probably wouldn't want to work with developers. There's a high chance the loan would be paid off and closed within a couple years or much earlier if it's a small development meaning claw back of commission.

Commission structure is different to normal resi loans.

 

[antistar]

Hi Leo T and congrats on the interview

I have found most other interviews on these boards inspiring due to the interviewee's personal story of growth to the present day, where they came from and their clearly listed milestones along the way. I enjoyed reading about your first apartment purchase at a young age and then it all got a bit abstract and text book generic from there for me (perhaps a bit impersonal with a lot of generic advice and theories). Having enjoyed the read I am now interested and would love to hear some specifics around your growth path or at least try to put your growth and success in a perspective compared to your humble beginning.

Perhaps a lot of the more regular forum members on here are familiar with your story from other posts and threads - for the more casual visitors like myself (that may rely just on the interview thread alone) it makes it hard to get the full picture of who you are and why we are reading this interview (i.e. what is the milestone of success - we get no indication of this just by reading the thread as a stand alone article. Other interviews on SS I found have been very clear in establishing this).

Not a dig at you or interviewer by any means (I did mention I quite enjoyed the read), just some feedback that may be helpful for those like myself that have read the interview without knowing you / your success milestones as the interview doesn't give out much of this picture on its own.

Cheers and good luck with all current / future projects

 

[devank]

I thought the interview itself was a gem.. then your responses came! Thank you for your inspiring advices.

Just wondering... You talked about how your uncle showed your the path at the age of 17. Were they in the property development themselves? Were you able to use their trusted contacts?

I thought this was useful (at least to me personally)

The hard work is the self development stuff IMHO. Building the courage, resilience, patience, handling the fear and anxiety, negativity from most ppl, handling our doubts etc. Developing the mindset to deal with all that is the hardest part IMO, and the reality is that everything rests on this foundation. So if the foundation is weak then what can be built on it will be limited IMO.

 

[LeoT]

Hodge, I'm mainly referring to commercial lending. I believe Leo and yourself are referring to the basic buy and hold type finance. I have used brokers for the latter approach, recently in fact (refinance). They definitely excel at this type of lending. With the former, ie commercial, i have always dealt with banks direct and have had greater success. I prefer ringing the bank/relationship manager direct, putting up the proposal and getting a response within a few days (and not always subject to Credit approval). I know a couple of other SS forum members that have the same approach and wouldn't change it. It's a great set up. A blanket statement about sourcing your own finance being a waste of time is therefore ill informed.

Hi oct

I should have made my comments re brokers clearer your right. My apologies. I agree with you re commercial finance and building relationships and self sourcing . I was just referring to normal ip loans. I didn't mean to ill inform others but I was sloppy with my comment. My bad .

Cheers
Leo

 

[D.T.]

Antistar
Yes I agree with you and thats what I was trying to get at with my previous posts in this thread. I've spoken to Leo before and he's achieved much more than is alluded to in his interview.

I think the lesson here is that everyone should come to the somersoft chat room. It seems this is where some of the real conversations happen.

 

[MTR]

what happens in the chat room, just curious

 

[devank]

I think the lesson here is that everyone should come to the somersoft chat room. It seems this is where some of the real conversations happen.

Not when pinkboy & DaveM are there!

 

[LeoT]

Hi Leo T and congrats on the interview

I have found most other interviews on these boards inspiring due to the interviewee's personal story of growth to the present day, where they came from and their clearly listed milestones along the way. I enjoyed reading about your first apartment purchase at a young age and then it all got a bit abstract and text book generic from there for me (perhaps a bit impersonal with a lot of generic advice and theories). Having enjoyed the read I am now interested and would love to hear some specifics around your growth path or at least try to put your growth and success in a perspective compared to your humble beginning.

Perhaps a lot of the more regular forum members on here are familiar with your story from other posts and threads - for the more casual visitors like myself (that may rely just on the interview thread alone) it makes it hard to get the full picture of who you are and why we are reading this interview (i.e. what is the milestone of success - we get no indication of this just by reading the thread as a stand alone article. Other interviews on SS I found have been very clear in establishing this).

Not a dig at you or interviewer by any means (I did mention I quite enjoyed the read), just some feedback that may be helpful for those like myself that have read the interview without knowing you / your success milestones as the interview doesn't give out much of this picture on its own.

Cheers and good luck with all current / future projects

Hi Anistar,
Thanks for your post mate. Y- man asked me if I didn't mind to share my story and fill out an interview question format. I was hesitant in the beginning but I agreed cos I thought if my story/path helped anyone a little then it would be cool. I think I have tried to explain how I started and the path I took. So from buy and hold to buy renovate and sell to developments. I had purchased about 5 buy and hold plus a few renos in there to accumulate enough equity to be able to fund small developments . I had started with a duplex ( still do them today although prefer larger sites ) and made a modest profit. Learnt a lot from my very first one that's for sure ! I rolled the allowable equity from that project plus refinanced all my other ips in order to do my first commercial project, was a 4 townhouse development in Sydney. Another steep learning curve. At that time I made contact with a guy called Ron Forlee who I can say is an amazing guy! Anyway. He helped me a lot at that time. The project went better than I expected and with that stock I had decided to rent 2 and sell 2. Doing the same thing as before I had rolled all the equity I had to do another larger project. Did this for a few years building up more equity whilst at the same time realising Profit for myself. I also hold some real estate in Taiwan. Over the years I have done a few other development coursess like carly crutchfield and bob Anderson. I hold both of them in very high regard especially bob! Brilliant guy and mentor.

Hopefully this adds a little more detail. Mate I'm not sure how much detail and how personal u want me to get but I think I have posted some useful comments in the interview as I answered the questions I was asked. I've also answered some questions in some detail in this thread.

If I'm going to be really blunt , I didn't post "theories and general advice" . That's the exact path I took mate. If I were to post specifics on my specific negotiation strategies for each purchase, town planning issues, da issues, feasibility learning, designing, managing projects, finance issues, legal clauses, site analysis and a whole host of others, we would be here for a vey , very long time.

Cheers Leo

 

[LeoT]

I thought the interview itself was a gem.. then your responses came! Thank you for your inspiring advices.

Just wondering... You talked about how your uncle showed your the path at the age of 17. Were they in the property development themselves? Were you able to use their trusted contacts?

I thought this was useful (at least to me personally)

Hi devank,

Glad you found some value in it mate. With regards to my uncle, it was actually not him but the family friend he did business with that taught me in the beginning. He broke it down into 4 areas for me. 1 personal development, 2. Business principles/finance,3. Property investment specifics and 4. Negotiation/psychology. He was really old school. A lot of stuff he taught me/indoctrinated in me if I repeat to others..I think some ppl would jump up and down

With regards to contacts ,I suspect just like most on here I have been accumulating over the years. I also made some great contacts on this forum which I'm grateful for!

With regards to finding the mindset stuff useful - IMHO it's 80% the battle to great success.

Cheers
Leo

 

[LeoT]

what happens in the chat room, just curious

I get bashed for "preaching" mindset stuff

 

[Television]

I get bashed for "preaching" mindset stuff

I figure you just keep doing it because you know most humans are so dumb they have to hear the same thing 50 times before they consider it...

(That's not an insult directed at anyone, I'm one of those people )

 

[LeoT]

I figure you just keep doing it because you know most humans are so dumb they have to hear the same thing 50 times before they consider it...

(That's not an insult directed at anyone, I'm one of those people )

HI television,

I do it because I actually care about investors doing better/achieving their dreams faster. I know I love to learn things that makes me do better! I hear what some ppl are saying that 'everyone is different' and 'its not for me' or whatever else is said. I just know with certainty, with absolute certainty that if all investors further develop their mindset they can definitely take their game to a whole new level. It would be so easy for me to just shut up and not keep mentioning about this and avoid being called by some 'preachy, forceful, nagger' etc. I keep on this point because if I really care, I cant just ignore it, knowing how important it is.

You know, when I started, what kept me working 80 freakin hours a week... sacrificing my whole life for almost 10 years, all the disappointment, the failures, the misery on some deals, the blood sweat and tears...the arguments, the fights at home, the doubts, the massive uncertainty, the depression at times, the feelings of hopelessness and no control... what kept me strong and going to stay on my path and not waver, was the mindset principles I developed and held onto for life. I wont post mindset stuff in other threads, but ill just leave it to this thread so others don't get totally annoyed.

When I was 18, my mentor told me the mindset I had was that of a loser, of someone who is ready to work all his life and retire on very little. he completely ripped me apart and built me from bottom to top. This is where i'm coming from. I know its not for everyone, but for those who have highly ambitions goals, really, really ambitious goals, I hope some of this stuff will sink in. I am always open minded to learn new things and I have SOOOO much more to learn that is scares me how much! I am not trying to offend anyone so please no attacking replies.. ok.. I am just being as honest as I can. this is all my opinion OK

Leo

Cheers