My parents are looking to buy their first IP???

Hi guys,

I am in a bit of a pickle, and I was wondering if you could please express your opinions because they would be greatly appreciated.

My parents own their 2 bedroom apartment in Lane Cove which is worth about $500,000. It is 100% fully paid off. Dad is 64 and semi-retired (working part-time) and Mum is 57 and still working full-time. They have never purchased and investment property and are scared to borrow, but have thought about it if they could find a cashflow neutral property (or positive of course) for around $200,000 – $250,000.

If they were to use the equity in their home to do so, if for example they wanted to buy a place for $200,000, would they have to pay any cash or could they just use the equity in their home, and what would be the minimum that they would have to release to make the deposit?

Finally, if they are that age, would they be able to qualify for a loan? Would it help if I was a guarantor?

Any help and views would be greatly appreciated.

Cheers