Hi guys. Am new to the site and was wondering if there is some advice out there. My wife and i owe 355000 on our PPOR. It is valued at 495000. We also have two IP's one valued at 310000 owing 335000 tenanted at 320 per week the other is valued at 325000 owing 300000 tentanted at 350 per week. We have these properties through the same lender and manage the properties ourselves. The LVR is about 91%. We had to borrow more against each IP to cover MLI. We want to keep buying investments but don't want to overcapitalize. We both have full time employment and gross approx $160000 PA. Is it worth looking into using trusts to purchase more. We also understand that we need to try and get our LVR ratio down to 80%. Any advice would be great thanks
TO
Using a trust could be worth looking into, but it won't affect borrowing capacity or overcapitalising.
91% LVR is very high and risky. I would suggest you try to build up a cash buffer in a 100% offset account in case of emergency. Keep saving and wait for growth to kick in. It will be slow at first but hang in there.
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
Thanks Terry, I know that 91% is VERY HIGH. I guess sometimes you just need some reassurance that you are doing the right thing?? My other thought was to use my wife and my super to create a SMSF as use the 100k in that to buy another IP. Any thoughts?
You also want to be careful about putting all your eggs in the property basket. What about some shares with super?
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
Yeah i'm not up 2 speed with shares. would much prefer to concentrate on property at this stage. Shares will be something to look at in future no doubt
any other advise???
Have you got quatity survey reports done on both investments? This will maximise deductions.
Are both IP loans Interest only? so you can pay down the PPOR faster.
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
Yes got depreciation schedules done on both. We are repaying 2% repayments above our current interest rate on the PPOR which is making some good inroads (at the moment).
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