Current situation:
Own 2 IP's with total value of $590k (total equity $590k).
PPOR is worth $480k and I owe $400k on this (equity $80k).
Am starting the process of selling one IP ($290k value) and want to use these funds to pay off PPOR mortgage.
I would then look to purchase another IP for around a similar amount ($300k) with the obvious advantage of being able to utilise the interest on this loan as a tax deduction.
My current mortgage is with CBA and I have a 90% fixed component on PPOR which is locked in for three years at 7.59% with the remaining 10% on the variable rate of 8.62%.
Just looking for some advice/ideas on what the bank is likely to offer as a payout figure? Is this something you can get pushy with ie demand a higher figure? I entered into the loan in October 07.
I would prefer to stay with CBA and re-finance with the same proportion of fixed and variable interest given the current climate.
Thanks
Why do you have to sell the property why not just sell it into a Trust structure and pay the additional stamp duty and possibly any GST.
At least this way you will still own a property you now without having to pay selling agents commission.
Unfortunately you will not be able to switch the securities or pay down one loan and borrow the same amount at the same rate as what you will be doing will fail the ATO "Purpose test" thus making the interest non decuctible again.
Unless you sell the property into Trust or take out a separate new loan you are going round in circles and getting nowhere.
Finally a word about the Big C they dont lend to HDT or Unit Trust structures.
Richard Taylor | Australia's leading private lender
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