HCYou shouldn't be paying spare money into your LOC as you are paying down the loan. This is decreasing tax deductions. Best to put spare money into an offset account for the same savings but without the tax implications.

You should get all income and rents placed into the offset account and this will save you interest. the quicker and longer the money stays in your account the more interest you save.The offset works by reducing the amount of the loan you pay interest on. eg. If you had a $100,000 loan and $90,000 in the offset, you only pay interest on…[Read more]

You should get all income and rents placed into the offset account and this will save you interest. the quicker and longer the money stays in your account the more interest you save.The offset works by reducing the amount of the loan you pay interest on. eg. If you had a $100,000 loan and $90,000 in the offset, you only pay interest on…[Read more]

The savings on a 100% offset account and IO loan will be the same as a PI loan. Providing you are not tempted to spend the cash.

The savings on a 100% offset account and IO loan will be the same as a PI loan. Providing you are not tempted to spend the cash.

Terryw wrote:
JacM – usually, but not always.Imagine he had a loan of $300,000 and $100,000 in the offset. He wanted to buy $100,000 worth of managed funds. He could: A. use the money in the offset, or  B. he could pay down the loan and reborrow it to invest.At the moment this would not make any difference. But what would happen if he decided t…[Read more]

Terryw wrote:
JacM – usually, but not always.Imagine he had a loan of $300,000 and $100,000 in the offset. He wanted to buy $100,000 worth of managed funds. He could: A. use the money in the offset, or  B. he could pay down the loan and reborrow it to invest.At the moment this would not make any difference. But what would happen if he decided t…[Read more]

But consider the tax consequences.Say you had a $300,000 loan and paid it down to $200,000. $100,000 off the princple. You then go and decide you want to buy a house to live in, but you have no cash. You can take $100,000 out of redraw and use that as a deposit, but the interest on this $100,000 won't be deductible.Whereas, if you had used a 100%…[Read more]

But consider the tax consequences.Say you had a $300,000 loan and paid it down to $200,000. $100,000 off the princple. You then go and decide you want to buy a house to live in, but you have no cash. You can take $100,000 out of redraw and use that as a deposit, but the interest on this $100,000 won't be deductible.Whereas, if you had used a 100%…[Read more]

its very hard to find things here. Try searching on "living off equity"

JacM – usually, but not always.Imagine he had a loan of $300,000 and $100,000 in the offset. He wanted to buy $100,000 worth of managed funds. He could: A. use the money in the offset, or  B. he could pay down the loan and reborrow it to invest.At the moment this would not make any difference. But what would happen if he decided to move into the p…[Read more]

JacM – usually, but not always.Imagine he had a loan of $300,000 and $100,000 in the offset. He wanted to buy $100,000 worth of managed funds. He could: A. use the money in the offset, or  B. he could pay down the loan and reborrow it to invest.At the moment this would not make any difference. But what would happen if he decided to move into the p…[Read more]

I've deleted the email I received now, so can't check. I think it was 99% inclusive of LMI.

I think you are mis-using the term 'refinance' which may make things confusing. If you have paid off your loan, then there is nothign to refinance. You will be taking a new loan. This applies even if you have paid down the existing loan to $1 and then take money out via redraw – this is reborrowing.What you said above is not correct.You will be…[Read more]

Nothing wrong with these ideas. They have been discussed here in the past.One problem, especially after the GFC is that lenders have tightened up lending requirements. So if you are not working it will be very hard to qualify for finance.

There is an overlap provision of 6 months too – where you can have 2 main residences and claim both, but it only applies if you are moving from one to the other and selling.

The gain after discounts and other costs is just added to your other taxable income. If you had $0 taxable income then you may be able to earn $16,000 pa tax free, but after that you will be paying tax – but probably not as much as you normally might be if working.

There is nothing really out there like that. You will need to see a solicitor and/or accountant to see what would work for you.try trustmagic.com.au for some infotaxlawyer.com.auOr you can buy the expensive http://www.taxinstitute.com.au/publications/new-trust-structures-guide-2010

I thought I covered that.They would need to be a beneficiary of a trust.

I don't think the average property is a good investment in this climate. You need something special to get any gains.Assuming you could find a good property, why not do both?take out your cash and buy a house to live in, get the FHOG and stamp duty exemptions. Stay for 6 months, do it up to maximise valuations and rent. Then move out again but to…[Read more]