Hi therer, gurus
I got bit of cash and want to pay down my small remainder PPOR loan competely. I was thinking to pay it down then refinance whatever amount out in the forms of LOC for future purchase.
However My banker told me that due to the bank policy change, they can only do 60% to 65% LVR .. as I already withdrawl some of the euqity out over the years.. if they use 60% LVR that means i wont be able to withdrawl anything out as LOC , even I paid off PPOR loan.Hence I have a option of putting in offset Or pay down the loan and redraw.
i want to know if the interest on the redraw ( from my PPOR loan) can be deducable, providing it’s for investing purpose and not mingled with any personal use ?
i think the answer is yes. but not 100% sure.
hope to hear your advise.
What type of property is this? You shouldn’t be restricted to such a low LVR – it may be related to your serviceability instead and the banker isn’t clearly explaining this.
It’s still possible to draw out equity from a freehold property upwards to 90% LVR with many lenders.
Corey Batt | Precision Funding
http://www.precisionfunding.com.au
Email Me | Phone MeInvestment Focused Finance Strategist - servicing Australia-wide
If you pay the loan down to nil and redraw and invest you should be able to claim all the interest provided there are no detours.
If the loan is not paid down to nil then it will be a mixed purpose loan and you will have to apportion./
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 think the same as you…that should be how the logic goes. luckily my PPOR loan is not a big amount.
this is a better than offset in my view, as offset will lose the interest deductbility.
my banker said it’s the purpose of the funds that determines the LVR, so if you buy investment properties, the current LVR is only 65% as per banks policy.
so if you buy investment properties, the current LVR is only 65% as per banks policy.
you should never take tax advice from a banker!
It is the use that determines deductibility. If you borrow to buy a main residence and then move out and rent it the interest will be deductible at this point even though the purpose was to buy a main residence. the funds are being used to own an income producing assets and are therefore deductible.
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
Time to start using an investment focussed broker, instead of a product shill for a bank. Why limit yourself to accessing half a dozen products and one lenders policies, when you can leverage off the policy and products of dozens of lenders and thousands of products.
That way you can pull your LVR up to 80%+ and expand on your terms, not one lenders restrictive policies.
Corey Batt | Precision Funding
http://www.precisionfunding.com.au
Email Me | Phone MeInvestment Focused Finance Strategist - servicing Australia-wide
you should never take tax advice from a banker!
Wise words!
The ones I’ve personally dealt with have been more concerned with up-selling products rather than taking care with the advice they give.
Which lender are you with OP?
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]
you should never take tax advice from a banker!
Wise words!
The ones I’ve personally dealt with have been more concerned with up-selling products rather than taking care with the advice they give.
Which lender are you with OP?
Cheers
JamieAnd no one should take lending advice from a banker either!
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
The LVR definitely doesn’t sound right. A lot of Lenders have pulled back to 80% with recent investment lending changes but a still a few offering LVR’s around 90-95%.
Matt McLean | Rams Home Loans
Email Mehope to hear your advise.
@coogee126 You need to run your situation past an experienced financial strategist so you can attain your investment goals/financial objectives.
If you’d like to contact me I can refer you onto a very experienced strategist who has helped me over the past 13 years who has also attained financial independence many years ago.
Rick | My Property Investing Tools
http://mypropertyinvestingtools.com
Email MeFREE Download >> Click my website for the Tools I used to Build a Multi-$Million Portfolio & Retire.
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