Hi,
I have been given conflicting advice on how to structure loan for an investment property:
1. 80% fixed, 20% variable, with an offset account).
2. 100% fixed.I would be borrowing roughly 280/300k. After comments on pros and cons of each strategy considering todays economy. Thanks,
Keith
Outside of playing the casino by picking rates, the first option provides significant benefits in having the offset portion. The 20% portion would be minimal in either case, so even significant rate changes won’t change the interest liable hugely – so I’d put a lot more weight in the ability to store funds against the IP.
The exception to this is if you already have a PPOR to store funds against.
Corey Batt | Precision Funding
http://www.precisionfunding.com.au
Email Me | Phone MeInvestment Focused Finance Strategist - servicing Australia-wide
Hi Kieth
Do you own an own a PPOR? If so – does it have a mortgage? and is it fixed/variable or a combination?
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]
Hi,
I have been given conflicting advice on how to structure loan for an investment property:
1. 80% fixed, 20% variable, with an offset account).
2. 100% fixed.I would be borrowing roughly 280/300k. After comments on pros and cons of each strategy considering todays economy. Thanks,
Keith
There is no right/wrong answer as to fixing variable. You may want to fix if you think rates may go up again in the next few years.
no need for an offset on an investment loan unless there is no non deductible debt.
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
You must be logged in to reply to this topic. If you don't have an account, you can register here.
