Broker would likely get a new upfront commission from the new lender. This could be the motivation.Watch out for withdrawing money from the loan as if it goes towards the new PPOR then the interest won't be deductible and you will have mixed purpose loan.

Also problems in getting finance if owner builder

Possibly wouldn't include interest unless you didn't claim it along the way. Also incl buying and selling costs, commissions for agents, advertising for sale, legals etc

normbay wrote:
I think the guys at Acceptance Finance would give you a better idea than the Forum on this question. Bear in mind that the tax-deductibility of the debt follows the purpose of the debt – so what is the purpose of debt financing for your offset account? If that's to reduce your personal interest cost, then it probably is not…[Read more]

BrianN wrote:
Hi, I am a newbie of this forum and I appreciate your advice on my property investment.Currently I and my wife own a PPOR worth 550K valued by bank. The loan balance is 175K.We are going to buy a townhouse at around 737K and plan to move in and turn current PPOR into IP.I intend to refinance the loans with another bank as fo…[Read more]

If your intention is to hold then generally CGT would apply. If you want to just build and sell then generally income tax.CGT would be sale price less cost base. If over 12 months then 50% discount may be available.

Good news Paulps when are you coming to Sydney again?

One loan being refinanced with another

if they don't defend it in court, then could be quick. file a statement of claim, wait 28 days get a judgment and then try to get the money – but then they may apply to set aside the judgment. Or more likely, they will just pay.Of once they are served court judgments they will just probably pay. If they want to fight it then maybe 6 to 12 months.

The strata fees are a debt and if they aren't paid the strata corp can take the owners to court and get a judgment. Once a judgment is obtained they can then proceed to recover the monies owed such a seizing property (with court orders) etc.

Harry,Good in theory again, but very hard to implement. Why would a partner take all the risk and give you a bit of the profit?You could use a unit trust (to take part of the risk) and protection your ownership position. But there are many things to cover.

Its possibly tax deductible, and so are the proceeds if paid out.If it is added to the loan you will be paying interest on it too.But that sounds like a high premium so I suggest you get another quote.

IO will usually automatically revert to PI at the end of the IO term.You can then, or before, approach the bank and ask them to extend the IO term.

It may be good in theory but you will find it extremely difficult to find a lender willing to lend to you when you are borrowing money from the vendor to complete the sale.

Gluttons for continuing education points too.

If you use cash then you cannot take out a loan to refinance this – and claim it. ie the interest on the extra money borrowed wouldn't be deductible as it wouldn't relate to the property.

hi Richard,Good question. I am working with structuring and setting up estate plans for people and loans are a big part. There are so many silly brokers out there and so many people are simply throwing their money away by paying too much tax because they haven't got a simple part of it correct. Now I can give tax advice and legal advice and credit…[Read more]

Whats going on Jamie? Why is everyone leaving?I am just about to become a broker again.

Carl, you are throwing money away!

OrSet up a LOC on the PPOR and use the LOC to pay for the initial  deposit/costs so that you only need to borrow 80% under the main loan. This will avoid cross collateralising the loans and also avoid LMI. Why didn't he suggest this? he could have cost you $7k.!