Five years is a very long time to lock yourself in with a lender. What happens if you need to refinance or sell up? The break costs could be quite high.

Cheers

Jamie

I wouldn’t do it Troy.

You already have doubts and don’t feel comfortable with this. Give it a miss.

Cheers

Jamie

Hi Keldyn

I wouldn’t be surprised if you could purchase again.

Depending on your tolerance to risk – you could extract equity in that first IP to cover the deposit/costs on a third.

Cheers

Jamie

1. You can usually extend the interest only term or refinance to another lender at a renewed interest only term.

2. Valuations don’t often come in lower than purchase price. However – for refinancing, it’s not uncommon for the valuation to be lower than the clients estimated value of their property.

Cheers

Jamie

Hi Liana

How much are you looking to spend?

General rule is that banks will lend up to 97% of the properties value.

However – that usually means a 93% or 94% loan with the Lenders Mortgage Insurance (LMI) added on top.

Some banks still do the old 95% + uncapped LMI up to 99% but they are becoming rare and not easy to get approved.

Cheers

Jamie

Hiya

It’s a LOC that you a premium for – you can do the same thing with a standard IO loan.

Some people get into a big tangle using the portfolio loan. They think it provides ease – but they end up with a crossed up mess of properties.

Cheers

Jamie

Yep – that’s how I’ve read it too….and the basis for my response. Quite a normal structure.

Cheers

Jamie

1. Yes – it’s fine.
2. Why would it be illegal? It’s your equity – you don’t have to use ANZ to fund the next purchase. You can use whichever bank you like.

Cheers

Jamie

Hiya

Only way to found out for sure is to get the advice in writing from your local council.

Someone that constructs GF’s in the area should know too.

Cheers

Jamie

Hi parreels

Good thing you stumbled acrross this forum – whoever suggested that structure doesn’t have a clue.

Corey’s on the money. Inject funds from your offset into the loan and reborrow to fund the deposit/costs on your IPs then set up stand alone loans for each property.

If in doubt – get a decent finance person to sort it out for…[Read more]

Hi Baz

Just use a superstar broker – plenty on this forum to choose from. Call a couple – get a feel for what they offer and go from there.

Cheers

Jamie

100% agree.

You need to build rapport with tradies – not get them off side.

Get a couple of quotes and go from there.

Cheers

Jamie

That’s quite generous of them – I don’t know many that will do that.

Like Terry mentioned – prob best to put any offer via your solicitor if you’re concerned about wording, clauses, etc.

Cheers

Jamie

+1 for Darryl. You’ll be in good hands.

Cheers

Jamie

It’s a bit of a generalisation but it does tend to hold true (in my opinion anyway).

My worse performing property in terms of capital growth is also my best performing in terms of cashflow. However – the additional cashflow that it generates isn’t significant enough to make a huge difference.

Therefore, I’m a bit of a boring buy/hold in larger…[Read more]

Hi Calderan

Welcome aboard.

This doesn’t directly address your specific question but I wrote a blog entry explaining the basics of positive/negative gearing a while back. Here’s the link – hope it helps.

Cheers

Jamie

Hiya

It depends.

If it’s a set and forget IP that you don’t plan on doing too much with (selling, releasing equity, etc) and you take comfort in knowing what your repayments will be then fixing can be a good option.

Note – you can still release equity against a property with a fixed loan but if for some reason the lender doesn’t allow it then…[Read more]

Hi Joe

Yep – important to set up second split against PPOR.

You then set up a third loan against the IP.

Best not to place borrowed equity back in an offset though – instead, place it back in the equity loans redraw facility for future use.

Cheers

Jamie

Hiya

Do a google search and/or read some of his books. I’m sure all the info is easily accessible.

Cheers

Jamie

Not at all – and I’m not a competitor to this business model. I’m a mortgage broker – I don’t (and never will) sell off the plan property.

Cheers

Jamie