Agreed – seems to be flying along now.

Cheers

Jamie

Hi Opee

Bank valuations are generally outsourced to independent valuers.

Even the ANZ model estimates (desktop valuations) are generated via Australian Property Monitors.

The desktop valuations look at a number of variables to come up with their estimate – such as comparable sales within the area.

If the higher desktop valuation provides you with a better outcome – then use that over the actual valuation.

Cheers

Jamie

Yes.

Why are you considering this? Way too many new investors jump into complex structures because they think it's the flavor of the month. There are a number of trusts – with various pros/cons. To gain an understanding of what would be suitable to your needs, you really need to consult the relevant professionals.

Cheers

Jamie

Just fixed.

Cheers

Jamie

Agree with the 3 year comment from Derek.

Any longer than 3 years seems to become a bit too long – and it's difficult to effectively plan this far out.

Personally, I can't see fixed rates going any lower. If you're considering locking in a fixed rate then I wouldn't ponder it for too much longer. Make sure you get your broker/banker to explain the pros/cons.

Cheers

Jamie

Did you pay LMI on these loans previously?

If so, an external refi to another lender will trigger another LMI premium which can be costly.

While I'm not a huge fan of NAB – is there any particular reason why you're moving all of your loans away?

If the aggregate borrowings is under $1m and the loans aren't crossed, I can't see there being a huge problem with sticking with the one lender – you should also be entitled to a decent discount on rate across the loans and only subject to the one annual fee.

Citibank have terrible servicing – I'm not sure what your income position is like but this is something that needs to be considered.

Cheers

Jamie

Ain't happening with Bankwest.

At 90% LVR it's an $11k cashout and that's not going to buy a whole lot right now.

Cheers

Jamie

The bank doesn't decide on the settlement date – it's agreed upon by the vendor and buyer in the contract.

If you want to delay it – ask you conveyancer to put this request to the vendor. I don't think it's an unreasonable request giving the timing.

Cheers

Jamie

Hi

No worries at all.

Yes, loan 1 and 2 are from the same bank.

They'll usually send out a valuer if the loan amount is going to be higher than 80% of the properties value. Otherwise they might go off  a desktop valuation.

Second split for the equity release means second loan. So if you looked at your online banking you'd have two loan accounts set up – the first being your original loan amount, the second being your equity release loan which can either be a line of credit or an interest only loan.

Yes, the interest repayments on the equity release loan will be deductible because it's being used to fund an IP purchase.

At present, you don't have enough accessible equity to purchase an IP. If your bank let you take your total borrowings up to 90%, you'd only be able to access $11k at present.

Cheers

Jamie

Hi Avalonesa

Congrats on the first purchase.

Some banks will allow you to access equity up to 90% of the properties value (some will actually go up to 95% but they're not easy deals to get across the line).

So on that basis, if your property was valued at $290k – the bank may let you take your current borrowings up to $261k which is 90% of the properties value.

Let's say, for arguments sake, that you had a loan of $200k against the property – then the equity you'd be able to access would be $61k. We come to that figure by subtracting the $200k loan from the $261k = $61k

You would then set up another separate loan to cover the remaining balance of the IP. So all up you have three loans.

PPOR

Loan 1: Existing loan ($200k)

Loan 2: Equity release for IP deposit/costs ($61k)

IP

Loan 3: Remaining balance for IP (can be the same bank as the two loans above or a different bank)

As your current property is a PPOR – you really want to set up a second loan split for the equity release so you can identify which is non deductible (your PPOR loan) and which is deductible (your equity release for the IP deposit).

Hope that helps.

Cheers

Jamie