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  • Profile photo of cham_chuancham_chuan
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    @cham_chuan
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    November 4, 2012 - 12:35 pm

    Terry
    My question is
    How would ato know what Adam used the money for
    When we borrow money from the bank for a property as a PPOR, ato really don’t care what we do with the money(I assume?)
    So, my imagination is… Before Adam buy his new PPOR, refinance first and make is owing bigger…
    Can this work?

    Profile photo of cham_chuancham_chuan
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    November 4, 2012 - 11:27 am

    Hi, guys
    I read all the questions and answer
    And I have a maybe silly question
    For tax purpose
    Can Adam refinance his current PPOR and make the loan look bigger

    315k*80%=252k or even more… Then Adam will have cash in hand to buy his new PPOR
    And from that time Adam starting to use his old PPOR as new IP
    So the 2 loans are very clear and also he will be able to claim more tax on his IP ?

    Sorry if the question sound silly… I’m very new to this

    Profile photo of cham_chuancham_chuan
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    November 4, 2012 - 8:53 am

    Hi, Tom Thank you for your reply The reason I'm thinking about taking out 100k was in case I see something a bit over 300k My question now is If I take out say 60k against my PPOR and start looking for an IP I find something around 350(including legal) I will then need 70k from my PPOR to avoid paying LMI Is that fair to say if I take out more than I actually need, as long as I don't use it, I will not be paying interest? I had a calculation how much I can take out from my PPOR without touching my redraw I will only be able to loan a line of credit of 56k….. Which mean my IP will need to be under 280…. Do you think it's safer to borrow a 100k?

    Profile photo of cham_chuancham_chuan
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    November 4, 2012 - 12:26 am

    Hi, Derek

    great opinion…. breaking things into small… that's what I need to learn 

    you guys are so helpful…. Thank you

    Profile photo of cham_chuancham_chuan
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    @cham_chuan
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    November 3, 2012 - 11:50 pm

    HI, Derek

    Of course you knew I was kidding

    hahaha….. 

    and thank you for the advice for the ownership…. I was actually thinking also need to consider capital gain as well…. 

    Am I too ambitious? 

    Quote :

     If you truly believe you can achieve your goal then you should give serious consideration to setting up some form of trust structure so your portfolio is secure from predators. This is an area where specialist advice is required and this advice will probably over-ride my comments about ownership in the previous paragraph.

    I don't really understand this… could u explain if you think I still need to know?

    :) 

    Profile photo of cham_chuancham_chuan
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    November 3, 2012 - 11:42 pm

    Thanks, Terry

    How much LOC would I be able to take out generally speaking?

    if i plan to apply for 100K, would i be be paying LMI even I don't use it?

    you are saying by getting LOC on my PPOR ,and leave the IP loan stand alone… 

    am i right by :

    when I spot a property, I use my LOC to put down the deposit 

    use the pre-approved loan for my IP

    and anything that is short, pay with the LOC?

    it makes sence…. to me

    is that correct?

     

    Profile photo of cham_chuancham_chuan
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    November 3, 2012 - 11:31 pm

    Thanks Jamie

    What other factors would i need when considering the structure?

    yes, we are hoping to get to 100 property in 3 years…(quote from Steve)

    Profile photo of cham_chuancham_chuan
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    November 3, 2012 - 5:54 pm

    Repost it again… Sorry something went wrong

    Hi, everyone

    We are seriously thinking of doing property investment

    I have done some study but never seem to be enough

    I wonder if anyone would help me and point out what you would do different if you were me

    Thank you

    My current situation

    Income: husband. 120K/year (approx)

    Wife(me) 0 (could be working part time earning under 30k/year)

    1 young child

    Current mortgage  PPOR market value about 470k

    Borrowed 340k, five years ago… Loan balance is 320k at the moment(25 year left), and I did pay LMI when I purchased my PPOR

    Cash in redraw ..60k

    we are looking to buy something under 300k(including legal fee) for IP

    I'm thinking to structure my loan like this

    PPOR  320K(change to interest only for 2 years)+ 100k(for IP) interest only(might need to pay some top up LMI)

    IP 200K max (interest only)

    How does this structure look to you? Please give me some opinion

    And also how would you do the share percentages for IP in between husband and wife for maximum tax benefit

    All opinion welcome, Thanks, everyone!

    Profile photo of cham_chuancham_chuan
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    October 31, 2012 - 11:38 pm

    Thanks Qlds007

    You have been so helpful

    Profile photo of cham_chuancham_chuan
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    October 31, 2012 - 12:25 pm

    Thanks James Bond (QLD007) for the warm welcome
    Your answer gave me a new question, what is the difference to secure with ppor or ip?
    As far as I know, whatever I borrow for ip from my ppor is also seen as the buying cost
    So why is it better to use ip rather than use some from ppor to save LMI ?
    Sorry if I sound stupid cos I’m really new
    Thank you

    Profile photo of cham_chuancham_chuan
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    October 31, 2012 - 11:32 am

    Thanks Jamie
    I’m so happy to hear that…

    At the same time, if anyone could advice me use 2nd mortgage and just pay top up for LMI are better or pay LMI on the investment property itself is better.
    Will they be different from tax aspect?

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