refinance ppor loan to purchase investment property

Hi,

I am aware that many people would have asked the same question in the past but I am still not clear on this and will appreciate your opinion.

In a nutshell, i am planning to refinance my PPOR and use the additional funds (i.e. cashout component) to buy another investment property.

My existing homeloan: $250,000

Current valuation of house: $425,000

Refinance based on 80%: $340,000

Ask the new lender to split the loan in two:

First loan: $250,000 (principle and interest)

second loan: $90,000 (interest only)

Initially i will advise lender to park the cashout component (i.e. $90,000

in second loan)

In the next few months, I will buy an investment property and that is when, I will withdraw funds from second loan ($90,000) and use them to purchase the new property.

I am thinking about doing this because then i can clearly show that $90,000 was used to generate income and hence I can claim tax deduction for interest paid on that amount.

Thanks,