Don’t forget that you can transfer properties without stamp duty or CGT payable on a separation. But watch out for CGT impregnated properties as you will inherit the debt.

i think in Melb there is http://www.gatherumgoss.com Pat

possibly.

what state?

Interesting situation.

Is it a main residence or investment? Owned prior to 1985?

I think insurance payouts are generally tax free, but not totally sure.

You could still pull out within the cooling off period.

I was in Shinjuku a few weeks ago  – extremely busy place. But I would be worried about investing in Japan because of the lack of capital growth (or decreasing values) and the high taxes.

What would the rental yields be?

You can always fix later too. At least make sure part of your loan is variable and set up a 100% offset account on this as it will save you interest (esp with a large income).

Refinancing to an offset would mean borrowing money to place in the offset. There is no return on this so the interest on this portion wouldn't be deductible

The future doesn’t pan out as expected. You may think you won’t need access to your cash now, but in 5 years what if you did want to buy a new car?

This person is going to be renting their PPOR out. So the loan interest will be deductible. Even if they move back in after 5 years they could deduct the interest during this time.

It is best not to pay down the loan in case they want to buy somewhere else. If they had paid down this PPOR loan (now investment) by $100,000 and had no cash available for the new house they would be in trouble. They would have to reborrow $100,000 from the old house loan and use for deposit etc. The interest on $100,000 would be $7000 pa. This would not be deductible because it is being borrowed for private purposes (even if taken from redraw = new borrowings).

Whereas if they had placed this $100,000 in an offset account they would still have saved the same interest, but when they buy the new house they just use the offset account cash. As this is cash there is no new borrowings. When they take the cash out of the offset the interest on their old PPOR loan goes up by $7,000. Because this loan is now for an investment property the whole interest on this $100,000 is now deductible. Net result is $7,000 extra in tax deductions = possibly $3,000 pa in savings.

No benefit in having a split loan unless u wish to borrow for something extra .

The idea is to stop paying the loan down, but still geting the benefits of you cash holdings, hence the 100% offset.