[PaullieMember@paullieJoin Date: 2009Post Count: 217]

January 2, 2011 - 1:44 am

I don't think thats what shes doing.

What she is doing, is buying property, renting them out and renting out another property to live in, a property not her own.

[PaullieMember@paullieJoin Date: 2009Post Count: 217]

November 11, 2010 - 8:18 am

No, I didn't have my name added to the title.

Our PPoR was already paid off anyway…

[PaullieMember@paullieJoin Date: 2009Post Count: 217]

November 10, 2010 - 4:07 am

148

Gotta get that a lot higher.

I've got to start looking at my super as well.

[PaullieMember@paullieJoin Date: 2009Post Count: 217]

November 9, 2010 - 1:01 pm

Thats exactly what I said.

Seems like common sense to limit liability wherever possible.

[PaullieMember@paullieJoin Date: 2009Post Count: 217]

November 9, 2010 - 11:18 am

He didn't recommend it, he was giving me the option.

No we do not intend on renting the property, we don't intend on moving.

So I'm guessing that's a no .

[PaullieMember@paullieJoin Date: 2009Post Count: 217]

November 7, 2010 - 5:53 am

So your going to take more out on your IP as a "reno" expense to pay down your HECS debt so you can continue claiming interest on the "reno" expense … then you wonder why we pay high taxes in this country.

[PaullieMember@paullieJoin Date: 2009Post Count: 217]

November 7, 2010 - 1:48 am

Fill it in and make a herb garden.

[PaullieMember@paullieJoin Date: 2009Post Count: 217]

November 6, 2010 - 7:08 am

Shelley D. wrote:

Tip I send my tenants a $50.00 gift voucher every time I get a good inspection report or after tax time – They love it and I love them for looking after my property.

Is that tax deductible? lol

[PaullieMember@paullieJoin Date: 2009Post Count: 217]

November 6, 2010 - 5:16 am

I wish my yummy mummy was into as this as you two are. hehe

[PaullieMember@paullieJoin Date: 2009Post Count: 217]

November 6, 2010 - 3:40 am

Received a price from a buyers agent in Perth, it was 12k, to give some idea.

I don't even know if that's a good/bad price.

[PaullieMember@paullieJoin Date: 2009Post Count: 217]

November 6, 2010 - 3:06 am

Exactly, pay of all non deductible debt first, then borrow to invent because the interest on borrowed funds to invest is tax deductible.

[PaullieMember@paullieJoin Date: 2009Post Count: 217]

November 5, 2010 - 2:20 am

Having equity in your PPoR definitely make a difference because you can use that equity as the deposit for your IP.

[PaullieMember@paullieJoin Date: 2009Post Count: 217]

November 3, 2010 - 7:10 am

Looks nice, I signed up, but went to add my first landlord and it didn't work, I have contacted support.

[PaullieMember@paullieJoin Date: 2009Post Count: 217]

November 3, 2010 - 6:06 am

Does anyone use any online/offline property management software?

[PaullieMember@paullieJoin Date: 2009Post Count: 217]

November 2, 2010 - 2:03 pm

Yer Richard I realise my MB should know this, and be telling me this.

I understood everything except:

Why wouldn't you simply pay off the LOC first then start dumping extra money into the offeset account?
Because every time you redraw it is treated as a new loan and if the purpose of the funds is not for investment the interest is not deductible. The loan then becomes contaminated.

What I meant was, with the extra repayments I want to make, should I use that to pay off the LOC first, then to the offset? How does that contaminate either loan? Sorry if thats a dumb question.

 

Banker, I was only ever mortgaging one property, my PPoR.

[PaullieMember@paullieJoin Date: 2009Post Count: 217]

November 2, 2010 - 1:38 pm

OK I understand.

With the LOC, is that at a higher interest rate?

Would it cost to redraw up to the 80% LVR of the re-evaluation of the IP?

Does this structure offer more protection for my PPoR? I'm assuming it will because Id only have $70,500 + costs tied to it, compared to the whole amount. Even so if the bank needed the money, they'd still sell my house to get the 70k + costs.

With this structure, is the interest charged on the LOC tax deductible?

Why wouldn't you simply pay off the LOC first then start dumping extra money into the offeset account?

Sorry for all the questions.

Thanks again.

[PaullieMember@paullieJoin Date: 2009Post Count: 217]

November 2, 2010 - 1:16 pm

Richard, I'm not experienced in this, I went with what made sense at the time. Neither my accountant or the MB suggested what you are saying.

So please, so I understand what your saying.

1. Take a loan for 80% of the funds from one institution for $282,000 with offset account.
2. Take a line of credit on my PPoR from another institution for $70,500 + costs.

Can you please explain how this model will work better for me? Like I said, I have no experience in this. What are the advantages etc.

Thanks Richard

[PaullieMember@paullieJoin Date: 2009Post Count: 217]

November 2, 2010 - 12:47 pm

I think I need to explain.

Firstly I currently hold the title to my PPoR which is values at 1.5 mil.

The loan for the IP will be $372,500 to cover all expenses as well.

I do not want the bank to hold two titles and they were going to slug me LMI if I used the IP only as security (>95% LMI).

So, I opted to use my PPoR as security, thus reducing the LVR so I don't have to be slugged LMI. In return I will receive the title for the IP.

When I pay down enough of the load below 80% LVR or so, I can swap the titles over is I choose to.

So you see, there is only one loan, with one title held as security, linked to one MISA account.

Make sense? Is this right?

[PaullieMember@paullieJoin Date: 2009Post Count: 217]

November 2, 2010 - 12:11 pm

I realize the MISA is not fully functional, I don't need it to be as I won't be using it for day to day transactions.

So you've said there no benefit to their wealth package, whats a good alternative?

[PaullieMember@paullieJoin Date: 2009Post Count: 217]

November 2, 2010 - 11:51 am

We compared 6 lenders, although CBA came out second out of six in terms of total loan repayments I chose CBA.

I currently hold accounts there and the wealth package now eliminated fees on those accounts.

I read that Bank West are despicable in terms of settling, and I have a 45 day settlement.

Any other suggestions? Also, to my question regarding IO loans …