Hi all,
I am able to set up a LOC account secured by my PPOR.
The amount will easily provide deposits for three IP's
Is using one LOC account for multiple IP's wise or not?
PJ
Morning PJ
Yes most lenders will allow you (subject to income and equity) to establish a LOC against your PPOR and some will allow mutliple splits.
I wouldn't have an issue in having 1 LOC for multiple deposits because structured correctly you will refinance the IP to draw out the equity and pay down the LOC anyway to allow you to keep on buying further IP's.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Yep, no probs there. As long as the LOC is being used towards investment purposes (ie. deposits on IPs) then the entire amount will be deductable.
Jamie Moore | Pass Go Home Loans Pty Ltd
http://www.passgo.com.au
Email Me | Phone MeMortgage Broker assisting clients Australia wide Email: [email protected]
I agree that it should pose no problems if all the LOC is used only for investment purposes.
But if you have the option why not split it up into several sub accounts in case you wish to use one for private expenses later? You may also want to capitalise interest on one and keep it separate in case you have problems with deductibility later it will be clearly distinguishable.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Thanks guys for the confirmation.
It is always appreciated.
PJ
Terryw wrote:But if you have the option why not split it up into several sub accounts in case you wish to use one for private expenses later?Agree, if your LOC allows for multiple splits than you should take advantage of it.
Jamie Moore | Pass Go Home Loans Pty Ltd
http://www.passgo.com.au
Email Me | Phone MeMortgage Broker assisting clients Australia wide Email: [email protected]
i would personally split it into separate sub accounts for each property cause there is then no grey area in regards to what debt is associated with each property if you sold one.
Hi all,
When we say
"……split it into separate sub-accounts"
are we saying there will be totally separate bank accounts each with their own fees etc?
Is this purely a bookkeeping thing? If it is, my wife is a book-keeper and could easily set up a set of boks for the LOC account within which would exist a number of transactions attributable to specific properties. These properties wthin the books would have their own assignment numbers. The LOC account would be run as if it was a business in itself.
PJ
hi property jockey, split sub accounts means separate bank accounts for each loan. most lenders have packages that allow this with no extra fees.
You must be logged in to reply to this topic. If you don't have an account, you can register here.
