Using your PPOR as security for the IP would not be a good idea even for a short period. It is not necessary as you have equity which you could use for a new LOC.For subsequent properties you could use the deposits from LOC 2 and get stand alone loans. After a while you can revalue each property and increase the loan and repay the LOC the initial…[Read more]

As a guide you can get roughly 5 to 6 times your annual income in borrowing capacity.Over time rents will rise and wages will rise (but so will prices!) and this should help you get into a few more.

Firstly, having a trust won't help with your borrowing ability.Secondly, don't base tax advice on what an unqualified mortgage broker tells you. If you want to know what structure to use it is best to talk to a tax agent or a accountant or a lawyer before you buy. once you buy it is too late.Each property you get will reduce your borrowing…[Read more]

I don't think you have much of a case it if was declared on the contract you signed.

It could be claimable outright then, better check with your tax agent.

You should seriously look at using a discretionary trust. Many issues to consider though

Yes, it would work out exactly the same from an interest point of view. So it wouldn't really matter if it went into the offset first or into the loan first, the interest would still be the same assuming you leaving in the offset during this time. You would set up the direct debit from the offset into the loan.There are probably 2 main reasons why…[Read more]

A repair is bringing the item up to the same quality as it was when you purchased it. An improvement is something which is more – ie brings it up to a better condition.This could be a repair if you replace the fence with the same materials as it is now. eg a wooden pailing fence being replaced with a wooden pailing fence = repair, but a colourbond…[Read more]

If you borrow money it is the purpose that determines deductibility.So if you use a loan from overseas and a loan from Australia and the property purchased becomes an investment property, then interest on both loans should be deductible.

If you don't foresee any growth, then there is no real reason to keep it. Think about the opportunity cost as well.

It may still be difficult even at 80% or less if you are a new contractor. It helps if you are in the same industry and the longer the contract the better,Also if you are contracting you generally have more deductions you can claim so even up with a lower taxable income which doesn't help either.

The problem is the contracting issues. The lender will be asking what will you be doing at the end of the contract. If u had 2 years history doing this it should be ok. But without that I doubt you would get over 80% LVR

You won't be able to get a loan while on probation at 95% LVR.

yep. especially if there is a probabtion period and a the LVR is above 80%.  Best to get the loan first.

How far you can go will depend on your incomes and rents.You don't have to take the new loan from the same bank as the LOC.However you may get a bigger discount by staying with one bank.You should use an offset account for all incomes and rents and this should be on your PPOR loan. If you odn't have one then on an IP loan. You cannot have an…[Read more]

Don't borrow money and put it in your offset or the interest may not be deductible.Set up a LOC and have the $60k undrawn and sitting there waiting to be  used.

its not a matter of just telling your broker. You need to apply and set up another loan on property A in advance (ideally) of starting the loan for property B

I would personally still use IO loans with a 100% offset account attached.Because:- money paid into a loan cannot be taken out without tax consequences- you will still save the same interest as using a PI loan- your repayments will be lower meaning you can afford more investments- your repayments will be lower which will help if you get short of…[Read more]

Here is one major reason:You have 2 properties valued $100,000 each. ie $200,000 in total.You have 2 loans of $80,000 each. each loan is secured by both properties (ie crossed)Things start to go bad in your personal life. You have a heart attack etc etc.You try to sell property 1. no buyers so you drop the price to $90,000 and quickly find a…[Read more]

Also some people can't help themselves with spending. If they have access to cash they spend it, so for them PI loans are a form of forced savings.But I agree that you should only use a PI loan on an investment when you have no personal debt left