The lender will take the existing rent and you income into account when getting the $76k loan. They won’t take into account rent from a proposed purchase unless this is happening at the same time – and then they will take the debt into account as well.

To work out how much extra you could possibly borrow use this formula

(Valuation x LVR) – (existing loan)

So if the value is $1.092 and the existing loan is $634K you could borrow an extra $76K at 65% LVR
($1.092 x 65%) – $634k

But you will still have to pass other hurdles such as the valuation coming in and serviceability.

Thanks Benny

You might have to try an accommodation bond loan in that case.

Another option is for a family member to borrow and onlend to MIL under a formal loan agreement. Loan can be paid out from the estate (if MIL dies first).

CGT probably won’t apply.

Assuming it does,

get a valuer in and work out what each block is worth. This should give you a % which u can use to apportion the original price and costs. Any specific costs to each block should be taken into account for the cost base for that block.

You cannot cut in in half because one block has a house.

I am a tax lawyer in the CBD and provide advice on structures/

Non owners cannot go on loans – they can, but no bank will allow it.

Your best option is a reverse mortgage – not sure why you think it not applicable.

Another option is to transfer part of the ownership – but stamp duty, CGT and other consequences.

Your MIL needs some good legal advice on the consequences.

Make sure you seek legal advice.

Brokers cannot provide tax advice – unless they are also tax agents or tax lawyers. but many of them do provide tax advice and get it wrong.

the best way would be to borrow the deposit under a separate split secured by any property and then borrow the remaining 80% secured against the new purchase.

Don’t use redraw