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  • Profile photo of JodieDJodieD
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    @jodied
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    July 8, 2008 - 9:43 am

    Try this -> http://www.facs.gov.au/internet/facsinternet.nsf/housing/nras.htm

    Profile photo of JodieDJodieD
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    July 8, 2008 - 12:21 am

    Thanks Richard, I appreciate your explanation.  JD.

    Profile photo of JodieDJodieD
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    July 7, 2008 - 1:13 pm

    Hi Richard,
    Yes – it was a bit of a mess.  But, we thought we'd tidied everything up about 12 months ago.  By consolidating back then, have we created a problem for interest deductions?  What sort of overhaul would be required?
    The second question was more of a hypothetical – not planning to do this, but wanted to understand the implications if we did.
    Thanks for your response, JD

    Profile photo of JodieDJodieD
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    July 7, 2008 - 10:17 am

    Hi,
    Keen to understand this also, as we have been considering turning our PPOR into an IP.  We currently have our loan set up as an IO, with an offset.  However, about 12 months ago we refinanced and consolidated some other debts.  Does this have any impact on the potential deductibility of interest?
    Also, if we were to go ahead, and then in 6 mths time want to access some equity for personal use – using our (new) IP as security – does this have any negative effect on the overall loan?  Or, is it simply that this part of the loan is non-deductible?  If the latter, would we be advised to keep the equity loan separate / split from the current loan?
    Thanks, JD

    Profile photo of JodieDJodieD
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    May 30, 2008 - 9:45 am

    Thanks Pud & Elka for your replies,
    I hadn't considered renting our home…  It possibly wouldn't allow us to increase our debt levels immediately to start investing -however,  we would have created our first IP :)  It is possible that we could rent somewhere similar for about $1000 less per month – but, we'd need this $1000 to contribute towards the mortgage as our IP would be negatively geared…  My head's not quite getting around the numbers, so I'll go away and work on some likely figures and see if it could work or not…  Thanks for the suggestion – definitely worth considering!  By the way, our PPOR is brand new – we finished building and moved in Mar 07.  We already have our home loan set up as IO, with an offset – from what I've read, this is the right structure for an IP…
    Regarding the other thought that Elka enquired about: Yes, we could sell our PPOR and possibly afford two +CF IPs in a rural area.
    Cheers, JD.

    Profile photo of JodieDJodieD
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    @jodied
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    May 30, 2008 - 9:23 am

    -744 in current situation, but if we sold our PPOR and bought two IPs – same debt level, same asset position (just a shift from personal assest to investment), reduced annual income (or living expenses, taking into account us paying less rent than we are currently paying mortgage, and a small +CF on each of our IPs) – we immediately move to +737
    Thanks Steve.  This is a benchmark that I'll revisit at the end of the year to check our progress.

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