Ahh… thank you. Terry, now I'm beginning to understand why you're advocating IO loan only if there's even a slightest change I'll convert it to an IP..

Pardon my stupid question, but do you earn interest on the amount in the offset account (such as those savings account)? Or it's just there to reduce the amount of interest you pay on the loan?

True, I see free offset with even higher interest but that negates the advantage of low to zero fees.So far, I'm tending to go with a big bank because of the flexibility and also I have intentions of getting an IP in the next year or so. I'm trying to negotiate waiver of the annual fees associated with such packages but it seem really hard as the…[Read more]

Terry, thanks. Now I know why financial institutions charge you for the offset account. My main reason for going with a basic no frills home loan is to save on the monthly account or servicing fees such as those incurred with a professional package account.Unfortunately, I'm not able to find a free offset account so I'll most probably stick with…[Read more]

Hi Terry,What I don't understand is if I'm planning to buy & hold it for the long term, shouldn't I be trying to pay off the principle instead of just paying interest only?Also, is it considered counter-productive since I'm negative gearing to claim tax benefits incurred through interest etc and on the other hand to have an 100% offset account to…[Read more]

Not too sure about the other states, but from my limited understanding for NSW as long as I stay a minimum of 6 months within 12 months of the purchase of the property I can claim using FHOG.