Hi
I have just sold my PPOR and I have a decent cash settlement coming my way (approx $300k). I also have a negatively geared property that is 100% mortgaged ($330k) and cross-securitised with my PPOR. I'm now looking at refinancing with another lender. I'm also hoping to buy 1 or 2 income properties in the next 6-12 months.
Is it better to have the $300k sitting in an offset account or reduce my current investment loan knowing I could redraw the funds when needed? What are the pros and cons of each product?
Thanks
sheilsy
Sheilsy
Definately go the offset option.
Richard Taylor | Australia's leading private lender
If you have any personal debt then it is worth considering reducing it.
If you have a lower income spouse the investing it in their name may be useful.
Offset against an IP is not really tax effective. It will save you deductible interest as opposed to earning you taxable interest if invested elsewhere.
Do you need this $300K for the properties you intend buying?
You must be logged in to reply to this topic. If you don't have an account, you can register here.
