The equity that you access will be spread over the deposit and costs on the IP.

So let's assume that the costs associated with the purchase are 5% of the purchase price – so you allocate $17.5k to purchase costs (such as stamp duty, legal fees). That leaves you with about $65k to cover the deposit meaning a loan of $285k would be required for the IP loan.

I can't comment on your borrowing capacity without knowing the finer details of your situation.

Cheers

Jamie

Sydney is hot at the moment – especially out west.

Personally, I've only seen a few valuations come back low this month – two were refinances where the owner thought their properties were worth more than they were valued at, the other was an OTP property.

I haven't had any valuations come in lower than purchase price for normal established dwellings in the last three months or so – it's quite rare.

Cheers

Jamie

Hi Graham

I think this might be the domain of Darryl Richards who's a regular on this forum is based up your way – https://www.propertyinvesting.com/user/rpi

He might be able to provide some advice.

Cheers

Jamie

Yes – if you're going to pay down any debt than non deductible should be the first to go.

If you suspect that your next PPOR may one day become an IP (like what you're doing now) than best to set this up properly from the start as well.

Cheers

Jamie

Refinancing costs should be deductible for an IP loan.

Cheers

Jamie

Hi Nicky

No need to have an offset linked to each loan – you only need to be offsetting one loan. You'd only need two if you managed to offset an entire loan – and had surplus cash to place elsewhere.

If you're planning on owning a PPOR at some point than best to preserve your current IP debt and utlise the offset against an interest only loan instead of paying down the principle.

You don't want to spend the next 6 years paying down a large chunk of deductible IP debt and then take on a non-deductible PPOR debt.

I'm not saying you shouldn't make an effort to make extra repayments – just make them into an offset account rather than into the loan itself. That way, when you do buy a PPOR, you can move those funds from your offset account onto your new PPOR loan – which effectively boosts your deductible debt whilst lowering your non-deductible debt.

Cheers

Jamie

I doubt it – otherwise PMs  in that state are going to be busy signing up tenants to the new format. Chances are it comes into effect when new leases are issued. In any case, best to suss out with the relevant authority in your state.

Cheers

Jamie

Thanks Shahin and Richard – appreciate the comments.

Cheers

Jamie

What's the actual product?

Don't just focus on rate – doing so can be costly in the long run. 

Cheers

Jamie

It depends. 

I'd look at accessing equity in whichever property has the lower LVR so as to mitigate any LMI expenses. It also comes down to who the lenders are and what their policies are like.

Cheers

Jamie