Hey Ben
No problems at all – my pleasure. I enjoy sharing info on the forum and helping others learn.
I’m big into photography at the moment – so find myself on the other side of the fence on those forums. I’m the new guy learning stuff and asking lots of questions :-)
Back to your question though. Accessing 90% will come down to your borrowing capacity, the property type/location and the lenders policy (not all of them are too keen to release equity up to 90%).
Who are you with now?
Cheers
Jamie
Jamie Moore | Pass Go Home Loans Pty Ltd
http://www.passgo.com.au
Email Me | Phone MeMortgage Broker assisting clients Australia wide Email: [email protected]
Terry fully agree with you but Chris doesn’t have any non-deductible debt (at least not a PPOR) and neither did I say he should take out a P+I loan.
The main idea behind my post is to lower your interest payments and to differentiate between IO for negative gearing (where the aim is to not lower your interest payments) and P+I or IO + Offset account (where the aim is to lower your interest payments and increase your equity in the property).
Thanks
AndrewsuperAndrew | Property Analyser and Finder Tool
https://property-analyser.com.auTerry fully agree with you but Chris doesn’t have any non-deductible debt (at least not a PPOR) and neither did I say he should take out a P+I loan.
The main idea behind my post is to lower your interest payments and to differentiate between IO for negative gearing (where the aim is to not lower your interest payments) and P+I or IO + Offset account (where the aim is to lower your interest payments and increase your equity in the property).
Thanks
AndrewOk thanks Andrew. If no non deductible debt then it may be worth considering, but the IO with offset can have some advantages too.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Unfortunately I may not be able to return the wisdom in regards to photography. I actually no less about that than i do about property investing. haha
I currently own my PPOR with my brother on a split loan with Bankwest. We both have separate offset accounts which offset our individual loans.
As i mentioned we have just received our planning permit for the development of a double story dwelling at the rear and am just awaiting a quote from the builder before I can approach a lender to fund the build. Our current combined loan on the property is 430k (My brother had a large deposit) and we anticipate the value of both properties upon completion will be 1.1mil and the build cost including subdivision to be around 350k meaning a 780k loan but still under the 80% that would activate LMI, i think?
Another option is I could potentially loan around 200k for the build from my parents, meaning only needing to borrow 150k from a lender, but I am unsure if this is wise?
I might get on this bandwagon and ask for some help too if i can. I’m trying to get my first IP soon, macquarie have asked me the fowlloing questions i am not sure if i’ve answered correctl.
3) regarding your preferred loan structure:
a) did you prefer 2 separate loans? Yes
b) for the loan increase to the current property – if you choose 2 loans, would you like that loan split in to 2 to reflect the current loan being refinanced and the extra borrowings for the purchase?I would like to use the equity in my existing property (80% would be about 240,000k)
I will need to access the equity as a separate loan split under the same security to maximize tax deductibility and to make it easy for my accountant to work out what those figures are come tax time.c) if you prefer just the one loan – would you like 3 splits to
reflect:
i) the current loan being refinanced
ii) the increase to the current loan (for the property being
purchased?)
iii) the other part of the loan for the new property being
purchasedYep, if your saving for a PPOR when you have an existing IP, then IO with offset is the way to go on the IP loan.
Any “principal” that would have been paid can be directed to the offset thereby reducing the interest to be paid which then leads to more funds being saved for that month. Then rinse and repeat.
When you find your PPOR, withdraw the offset funds and use as deposit, this way you have done everything you can to maximise your deductible debt.
Cheers
Tom
I might get on this bandwagon and ask for some help too if i can. I’m trying to get my first IP soon, macquarie have asked me the fowlloing questions i am not sure if i’ve answered correctl.
3) regarding your preferred loan structure:
a) did you prefer 2 separate loans? Yes
b) for the loan increase to the current property – if you choose 2 loans, would you like that loan split in to 2 to reflect the current loan being refinanced and the extra borrowings for the purchase?I would like to use the equity in my existing property (80% would be about 240,000k)
I will need to access the equity as a separate loan split under the same security to maximize tax deductibility and to make it easy for my accountant to work out what those figures are come tax time.I’m assuming that you are looking at tapping into the equity of your PPOR for the IP? In that case the separate splits are okay. However there is no need to access the full 80% ($240K) of the equity in your existing property. Should be just enough to complete deposit and closing costs and have the main loan against new property.
c) if you prefer just the one loan – would you like 3 splits to
reflect:
i) the current loan being refinanced
ii) the increase to the current loan (for the property being
purchased?)
iii) the other part of the loan for the new property being
purchasedThis is a no no as it sounds like it is being cross-collaterised here.
Cheers
Tom
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