Viewing 10 posts - 1 through 10 (of 10 total)
  • Profile photo of DOUGADCOCKDOUGADCOCK
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    @dougadcock
    Join Date: 2012
    Post Count: 22

    Just a quick question, I have one investment property with one bank can i use that equity to buy another property with another bank.

    Profile photo of bugeye23bugeye23
    Participant
    @bugeye23
    Join Date: 2012
    Post Count: 16

    quick answer. Yes

    Profile photo of TheFinanceShopTheFinanceShop
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    @thefinanceshop
    Join Date: 2012
    Post Count: 1,271

    How are you calculating equity? i.e what's the loan amount and the value of the property?

    Regards

    Shahin

    TheFinanceShop | Elite Property Finance
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    Profile photo of DOUGADCOCKDOUGADCOCK
    Participant
    @dougadcock
    Join Date: 2012
    Post Count: 22

    the loan remaining is 284,000 and the valuation of the property is 380,000. 

    Profile photo of TheFinanceShopTheFinanceShop
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    @thefinanceshop
    Join Date: 2012
    Post Count: 1,271

    Ok so at an 80% lend you have $20k in equity to use and at a 90% lend you have $58k (minus the LMI payable) in equity. Don't forget to set up the facility as a standalone facility instead of topping the existing loan.

    Who did the valuation?

    Regards

    Shahin

    TheFinanceShop | Elite Property Finance
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    Profile photo of DOUGADCOCKDOUGADCOCK
    Participant
    @dougadcock
    Join Date: 2012
    Post Count: 22

    thanks the bank did the valuation. Yes ill get a completely separate loan for the new property. Is that what you meant by stand stand alone. What i plan to do is get a 95% lvr using the equity from my IP and pay LMI with money i have. Is there any thing i should be aware of before i do this, This is my first time using equity, Will it effect my existing loan in any way with regard to repayments and the like. Any additional information would be greatly appreciated 

    Profile photo of TheFinanceShopTheFinanceShop
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    @thefinanceshop
    Join Date: 2012
    Post Count: 1,271

    Some banks will not allow you to go to 95% on existing loans whereas some lenders will if you are refinancing. 

    If you are taking out say $40k against your existing property and the existing loan is $284k then you need 2 loan accounts. One for $284k and the other for $40k. Then you will have the third loan which is for the 2nd property. 

    Regards

    Shahin

    TheFinanceShop | Elite Property Finance
    http://www.elitepropertyfinance.com
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    Residential and Commercial Brokerage

    Profile photo of DOUGADCOCKDOUGADCOCK
    Participant
    @dougadcock
    Join Date: 2012
    Post Count: 22

    thank you very much for your help

    Profile photo of TerrywTerryw
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    @terryw
    Join Date: 2001
    Post Count: 16,213
    DOUGADCOCK wrote:
    thanks the bank did the valuation. Yes ill get a completely separate loan for the new property. Is that what you meant by stand stand alone. What i plan to do is get a 95% lvr using the equity from my IP and pay LMI with money i have. Is there any thing i should be aware of before i do this, This is my first time using equity, Will it effect my existing loan in any way with regard to repayments and the like. Any additional information would be greatly appreciated 

    You should seek some advice on the tax consequences from doing that.

    Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
    http://structuring.com.au/
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    Lawyer, Mortgage Broker and Tax Advisor (Aust wide) http://propertytaxbook.com.au/

    Profile photo of Jamie MooreJamie Moore
    Participant
    @jamie-m
    Join Date: 2010
    Post Count: 5,069

    If you're doing an equity release against your current IP to fund another IP – you might not need to set up a second loan split for the equity because it's all IP related.

    However, if you're using the IP equity to purchase a PPOR or think that you may treat either property as a PPOR in the future, then you'll need to set up the equity release as a separate loan split.

    Cheers

    Jamie

    Jamie Moore | Pass Go Home Loans Pty Ltd
    http://www.passgo.com.au
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    Mortgage Broker assisting clients Australia wide Email: [email protected]

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