It is really irrelevant whether a property is cash flow positive or negative for finance. Every bit of income helps, but the risk is still the same for the lender and serviceability must be passed.

For a property not to affect serviceability, in theory, it would need to have about a 11% yield. But most lenders will cap yields for…[Read more]

All the other legal issues. Being a director is potentially dangerous and burdensome, but not being a director means loss of control.

Each lender has a different policy to other lenders so some will be good for what you are after others will not be good.

A trust is not a separate legal entity, but a company is. So the debts of…[Read more]

All the other legal issues. Being a director is potentially dangerous and burdensome, but not being a director means loss of control.

Each lender has a different policy to other lenders so some will be good for what you are after others will not be good.

A trust is not a separate legal entity, but a company is. So the debts of…[Read more]

see

https://www.propertyinvesting.com/topic/5076532-best-owner-structure-to-minimize-land-tax-2/

You need to seek credit advice from a broker. Was the reason that you failed serviceability or that you were too rent reliant?

As a guide you could generally borrow 7x your annual pretax income – very rough.

this will all depend on where the land will be as land tax is governed by state legislation. Something you should seek legal advice on.

A bare trust won’t really help though.

Yes a handful of lenders offer fixed with offset. Heritage and Adelaide are 2

A LOC is generally at call and the limit can be cancelled.

A term loan is generally for 30 years. There are differences in serviceability assessements too.

One could work as well as the other, but one could also be better than the other. This is something you need credit advice on as it will different from lender to lender. I haven’t written a…[Read more]

The rates on LOCs are generally very high and the term is generally at call.

You can use a term loan just like a LOC.

An alternative might be to use the LOC and then convert it to a term loan once fully used.

Get some tax advice

With debt recycling you pay down debt and then reborrow again, usually using the same loan.

Yes you can only claim interest on money borrowed to acquire, or improve, an income producing asset.

I don’t know why all these spammers are constantly making silly posts on this forum. Can they be blocked somehow?

No because there will be no interest.

If a loan is fully offset there will be no interest to pay, but if you remove the offset the interest will start again and this interest could be deductible if the loan related to the purchase of that property and that property then becomes available for rent.

No because there will be no interest.

If a loan is fully offset there will be no interest to pay, but if you remove the offset the interest will start again and this interest could be deductible if the loan related to the purchase of that property and that property then becomes available for rent.

ha ha Richard was right. They were being a bit misleading and deceptive when they said that. perhaps a refinance is worth considering

It wouldn’t make sense to use a LOC. The existing loan could be utlised and tax deductibility achieved if done right

You don’t know what you are talking about!

Thanks Colin

I am not an accountant but since only lawyers can set up trusts that doesn’t matter! I don’t do tax returns though.

I am. If you mean rent where you live and invest elsewhere aka rent vesting

I want to live in places where i don’t want to buy – CBD – so I rent at the moment.

This is something I usually suggest people avoid doing. Loss on the main residence exemption, land tax in many states – such as NSW where it would cost  $8,000 per year for land content valued at $500,000.

It would be better, usually, to own the main residence and rent it out, using the 6 year rule, and rent somewhere yourself where you could…[Read more]

It is probably best to go to a broker who could compare your serviceability across several lenders. I find that CBA is generally more generous than ING for example.

But like Richard said there will be not a huge difference. Generally not enough to make that much of a difference.