All Topics / Finance / pay monthly mortgage and withdraw it too?

Viewing 6 posts - 1 through 6 (of 6 total)
  • Profile photo of GSSWGSSW
    Member
    @gssw
    Join Date: 2004
    Post Count: 8
    October 27, 2004 - 11:43 pm

    Hi guys,

    Following up from my previous post titled “Where is my money going?“ I would like to ask the following question.
    In summary,
    My loan is now ~$105G owing.
    I have $109G in an offset.
    The sum is that I have enough cash to pay the loan off in total.
    In the short term, I would not like to close the loan off, but have learned from this forum that I am still required to pay the bank a minimum amount per month.

    So I am now reducing my minimum payements to that required by my bank (plus a little in case rates rise)
    Can I withdraw this amount every month as well, so in fact the monthly payment is just a token gesture to maintain the loan?

    Thanks.

    Profile photo of Mobile MortgageMobile Mortgage
    Member
    @mobile-mortgage
    Join Date: 2003
    Post Count: 913
    October 28, 2004 - 12:25 am

    Hi GSSW,
    Withdrawing the loan repayments may be possible, providing your loan has a redraw facility,
    However, certain lenders do charge a fee for each redraw transaction, and may have a minimum redraw criteria.

    A much simpler option would be an interest only loan, in this case there would be no requirement for principle repayments.

    Regards
    Steven
    Mortgage Broker

    [email protected]
    http://www.mobilemortgagemarket.com.au
    Ph:0402483216
    Ph:1800 820 500
    VICTORIA

    PLEASE note comments made should not be taken as specific taxation, financial, legal or investment advice.

    Profile photo of GSSWGSSW
    Member
    @gssw
    Join Date: 2004
    Post Count: 8
    October 28, 2004 - 3:09 am

    Thanks Steven,
    Will there be a charge (CBA) to change to an IO loan?
    You are right, there is a redraw charge.
    How about if I take the equivelent amount out of the offset account?

    Profile photo of Mobile MortgageMobile Mortgage
    Member
    @mobile-mortgage
    Join Date: 2003
    Post Count: 913
    October 28, 2004 - 3:51 am

    GSSW,
    CBA will charge a $300 loan switching fee,

    Keep in mind you will be required to make interest repayments if the balance of your loan exceeds the amount of funds in the offset account.

    Regards
    Steven
    Mortgage Broker

    [email protected]
    http://www.mobilemortgagemarket.com.au
    Ph:0402483216
    Ph:1800 820 500
    VICTORIA

    PLEASE note comments made should not be taken as specific taxation, financial, legal or investment advice.

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,213
    October 30, 2004 - 10:20 am

    Hi again

    It would probably be best just to pay the $300 and switch to IO. You may even be able to talk them into waiving this. This just keeping the same amount in the offset , should result in no interest payable.

    Putting money in and taking it out again can have tax implications too – if it is an investment.

    Terryw
    Discover Home Loans
    North Sydney
    [email protected]

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://www.Structuring.com.au
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au

    Profile photo of GSSWGSSW
    Member
    @gssw
    Join Date: 2004
    Post Count: 8
    November 1, 2004 - 8:00 am

    Thanks guys!

Viewing 6 posts - 1 through 6 (of 6 total)

You must be logged in to reply to this topic. If you don't have an account, you can register here.