What’s this creative LOC mean

Hey all,

I’m fairly new to all of this. Last week I was introduced to the use of LOC “Line of Credit” for invesment purposes in a new way to me. This is the way I understood it and I was wondering how many people out their were actually using this method.

If you have an amount of equity that is available to you, you can use it to pay back your investment loans. This way you would not have to service them with wages (your 33c in the dollar wages).

I’m not good at explinations without drawing pictures but here goes.

You have 250,000 in spare equity. You take out a line of credit for a bit less than this and use this money to pay any short fall you may have in loan repayments in any investment properties. You pay approx around 7% interest for this line of credit. So this leaves your wages earnings in tact to give you more servicability when talking to banks about getting more properties.

Can anyone tell me more about this method and or tell me who I can talk to in Melbourne to help me do my due dilgence. (How do you spell due diligence He He, I know what it means though)[dead2]

Beck.
“You have to leave your mouth open for a very long time before a roast chicken flys into it.” Early Proveb.