Frequently Asked Questions.

There are a number of reasons why you should consider investing in the US - however we also realise this is not a strategy that is going to suit everyone. The question can be perhaps better asked "Why invest overseas?"
Market diversity in one thing. Having a hedge against foreign currency movements perhaps another. These reasons alone are not compelling enough. The US offers some outstanding opportunities that are simply not available to the investor in NZ or Australia.
We have researched the areas that we personally invest in. We understand that the US market in made up of a number of sub markets - each offering opportunities to get involved from a capital gains persective, or for strong positive cashflow, or both. The ability to purchase foreclosure properties is another reason, or to purchase new build deals at below market value that we have available from time to time.

If you are just starting out, and perhaps a little unsure of what to do first...feel free to contact us at admin@globalpropertydeals.com to arrange a time for an open discussion. Before you do - read through our site information, and perhaps email us initially with some questions. We will discuss quite openly with you what we do, and perhaps how we can assist you.

If you are interested in one of our properties, then we suggest you contact the listing partner directly for a full disclosure of the property in question. If you decide that you want to go further with one of these properties then you will be sent an expression of interest form (EOI) which will detail what you need to do from there.

If you are in the USA on one of our tours - opening a bank account is as easy as walking into any major bank with your passport and driver license. Takes about 1 hour (paperwork).

You get a ATM/Debit card sent to your address which you can use for internet banking – once you get back home. Sometimes there is a qualifying period before you can get online to use electronic banking with some banks (maybe 6 months). The card will be handy to withdraw cash on later trips to US from most ATMs.

U.S.Management Team. Essentially our network of Listing Partners, and their affiliates.

No. As at May 09 we can obtain 70% finance with the more progressive banking institutions, depending on the product and bank. In the past we have arranged 75% and even 80% finance, but this is less common due yo the shifts we have seen in the lending practices by the banks as a result of the sub prime fall out. We have never been able to get 100% finance unless you have a US Social Security number and even then in the climate it is still difficult.

Yes. We have US accountants and Australian /NZ accountants that can help.

NO. As foreign non resident investors we do not qualify for a SSN. It is not required to open a bank account in the USA, or to invest.

In the United States, a Social Security number (SSN) is a nine-digit number issued to U.S. citizens, permanent residents, and temporary (working) residents. Its primary purpose is to track individuals for taxation purposes. In recent years the SSN has become a de facto national identification number.

We do however need to apply for a ITIN number (Individual Tax Identification Number) from the IRS on their W7 forms.

You need to get independant advice on this question - because everyones situation is different. The short answer is you are able to purchase property in either your own name or in a Limited Liabilty Company structure. Owning property in an LLC entity is a similar to owning property in a company structure.

We can assist you with suitabily qualified advisors who can better provide the advice you need.

We are not accountants and cannot give accounting advice. However we have tax experts in Australia, New Zealand and the USA who we can refer you to. Generally, you pay tax on your world wide income. There is a double tax treaty between Australia, New Zealand and the USA, which means with the right set up you will not be taxed twice on profits.

A tour has many advantages. While it is not necessary to attend one of our tours to purchase a property, a tour offers you a far greater degree of information and comfort around your investment decision to buy. Our tours are not about getting people to become investors - there is absolutely no pressure selling involved. In fact we would tell you that if you are not completely comfortable with a decision to invest - DONT.

All we do is try to provide you enough information to help you decide what you want to do. Being on a tour also means that you get to meet our team on the ground, and to be with other investors who are considering doing the same thing. You will be able to discuss whatever questions you have directly with other investors rather than take our word at face value.

As well as being extremely informative - the tours are good fun, and many friendships are made along the way.

Nearly allour GPD listings have been sourced and listed by our US based partners who are local people who know their market. While we spend significant time in the USA we do require their assistance. For example in a city the size of Houston's 5.5 million, its impossible for us to know the market with the same degree of competence as someone who is active in that market.

We can assist you with our contacts in the USA to do that remotely from NZ or Australia. The process can take up to 6 weeks. Alternately you can join us on our next tour – and do that within an hour in a bank of your choice over there. We don’t post the details of our contacts over there, because sometimes that does change, and we are mindful of only referring genuine investors so as to protect our relationships.

We have excellent contacts to assist you with the pre-approval process. Forms can be sent to you from our broker network in the US once you have identified a property of interest. Typically you may still be required to put down a minimum of 20%, and up to 30% of the purchase price, depending on the property in question and the lender involved. If you have identified a property you have an interest in – first step is to contact us at admin@globalpropertydeals.com and we will respond usually within 24 hours.

No.
The EOI form will however require you to place our fees with us up front. Our fee structure is 3% of contract price or $2500USD whichever is the greater.

Once the deposit has been made into our Australian accounts, and the form is returned, the property is deemed to be yours as a first right of refusal. Up to this point it is also 100% refundable. You have a few days to ask further questions and organise an offer document subject to your due dilligence and independant appraisals and inspection requirements which can be organised for you.

Once a formal offer to the vendor has been signed and presented on your behalf - $1000USD is deducted from our fee should you not proceed to confirmation, and we will refund the balance to you. This enables us to pay for the time we and/or our partners have taken to make arrangements on your behalf, and minimises your risk.

FHA loan is a federal assistance mortgage loan in the United States insured by the Federal Housing Administration. The loan may be issued by federally qualified lenders.

FHA loans have historically allowed lower income Americans to borrow money for the purchase of a home that they would not otherwise be able to afford. The program originated during the Great Depression of the 1930s, when the rates of foreclosures and defaults rose sharply, and the program was intended to provide lenders with sufficient insurance. Some FHA programs were subsidized by the government, but the goal was to make it self-supporting, based on insurance premiums paid by borrowers.

Over time, private mortgage insurance (PMI) companies came into play, and now FHA primarily serves people who cannot afford a conventional down payment or otherwise do not qualify for PMI. (source - Wikipedia)

Federal Deposit Insurance Corporation (FDIC): A federal agency that guarantees funds on deposit in its member banks and thrift institutions. The FDIC also performs other functions, such as making loans to or buying assets from member institutions to facilitate mergers or prevent failures.

The Federal Home Loan Mortgage Corporation (FHLMC) known as Freddie Mac, is a government sponsored enterprise (GSE) of the United States federal government. The FHLMC was created in 1970 to expand the secondary market for mortgages in the US. Along with other GSEs, Freddie Mac buys mortgages on the secondary market, pools them, and sells them as mortgage-backed securities to investors on the open market.

From 1938 to 1968, the Federal National Mortgage Association (Fannie Mae) was the sole institution that bought mortgages from depository institutions, principally savings and loan associations, which encouraged more mortgage lending and effectively insured the value of mortgages by the US government. In 1968, Fannie Mae split into a private corporation and a publicly financed institution. The private corporation was still called Fannie Mae, and its charter continued to support the purchase of mortgages from savings and loan associations and other depository institutions, but without an explicit insurance policy that guaranteed the value of the mortgages. The publicly financed institution was named the Government National Mortgage Association (Ginnie Mae) and it explicitly guaranteed the repayments of securities backed by mortgages made to government employees or veterans (the mortgages themselves were also guaranteed by other government organizations). To provide competition for the newly private Fannie Mae and to further increase the availability of funds to finance mortgages and home ownership, Congress then established the Federal Home Loan Mortgage Corporation (Freddie Mac) as a private corporation through the Emergency Home Finance Act of 1970. The charter of Freddie Mac was essentially the same as Fannie Mae's newly private charter: to expand the secondary market for mortgages and mortgage backed securities by buying mortgages made by savings and loan associations and other depository institutions.

In Sept 2008 Fannie Mae and Freddie Mac was taken over by the U.S. Treasury. It was one financial event among many in the ongoing subprime mortgage crisis. (Source - Wikpedia)

HUD is the term given to the Department of Housing and Urban Development.
A HUD foreclosure, or HUD home, is a single family or multi-family residential property acquired by HUD as a result of a foreclosure action on an FHA-insured mortgage. Most HUD properties are hardly dream homes, and are almost never found in high-cost urban areas.

The process of buying a HUD foreclosure is significantly different than that of purchasing a traditional home. HUD homes are sold through a bidding process that puts investors in line behind intended owner-occupants. During the first 10 days that a HUD home is listed for sale, only owner-occupants are permitted to place bids; if a successful bid is not accepted by the time the initial priority period has elapsed, bidding is opened to investors as well. HUD homes for sale are posted on Internet listing sites by special HUD-contracted management companies. Bids for HUD homes must be placed through a HUD-registered broker or agent and are usually submitted electronically.