All Topics / The Treasure Chest / A new mortgage with another bank

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  • Profile photo of jellybabesjellybabes
    Member
    @jellybabes
    Join Date: 2003
    Post Count: 6
    August 14, 2003 - 8:08 am

    Hi.
    If I have my PPOR with a load of equity in it mortgaged (for only a small amount) to one bank can I go to another bank to finance an IP, without having to change the original mortgage over to the new bank? I want the PPOR to provide the security for both properties and to be able to keep the IP title myself.

    Profile photo of Stuart WemyssStuart Wemyss
    Member
    @stuart-wemyss
    Join Date: 2003
    Post Count: 598
    August 14, 2003 - 8:36 am

    Yes and no.

    Only one lender can have the first mortgage over your property. Therefore you can:

    1. Increase your existing loan with your existing lender. The increase should be sufficient to finance 20% plus costs. You can then go to any lender and arrange finance for the remaining 80% (which that loan secured by the new property).

    2. Refinance your existing loan so that the new lender has the first mortgage over both the existing and new property. However, I would advise you to still have two separate loans. One secured by your existing property and the other secured by the new property.

    I hope that helps.

    Cheers

    Stu

    Property & Finance News
    at http://www.prosolution.com.au

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