buying first IP

Hi Chris,

Ideally i want to minimize my cash investment on the next house

i.e. borrow against the equity in your PPOR – sure, no problem if the Equity is available to do so.

…so i have looked into the idea of cross-collatorisation.

No need to do that – and you really don’t want to go there (mostly). There is a lot to consider, and a Property savvy Financial Planner or a good Mortgage Broker are the ones to guide you through this quicksand. One or two of them may well pop in with a reply too – look out for them.

You mention you have “$50k to $70k Equity on your house” – I can tell you now, we really need to know “What is its value” and “How much is still owed on it”. See, if you say your house is worth $400k and owe $350k on it, you have $50k equity – but you can’t borrow it all usually. Maximum loan is likely to be 95% (or $380k) so only $30k available to you, not $50k.

That kind of thing is where a Mortgage Broker earns their money – they come up with the “best option for YOU” based on your current fnancial position. They also can advise re cross-coll (whether to, or not, and why).

With your kind of wage, any tiny problem you might have will likely disappear quickly because of your very useful wage. Good one,
Benny

Thanks for the kind words Matt :-)

Chris – I’ve replied to your PM.

Cross coll can cause issues – and there’s no reason why your purchase needs to be set up in such a way. Unfortunately – some brokers/bankers just don’t know any better.

Cheers

Jamie