The biggest advantage of Interest Only, is the increased cash flow. Quite simply, it could mean the differrence betweenbeing positively gearedor negatively geared. Remember, if you are positively geared, there is no limit to the number of properties you can buy.

Dan.

If you want an extraordinary life you have to be prepared to do things that ordinary people aren’t prepared to do.

Hi Dan, this is my first time on the forum, so hopefully will get it right. You mention that with positive geared property there is no limit to the number of properties you can buy, Don’t you still have to borrow the money for the properties in the first place? Whether the investment is positive or negative you still have to prove to the lender that you can service the loan even when the investment is empty. This is the one concept that I’m having trouble understanding, How does the bank continue lending money when it goes way past your servicibility, surely the bank wont just assume the property will be always positively geared.I have 2 properties at the moment looking for a third , ones negative the other positive but still they only look at my servixibility, Can you please explain?? theres something I’m missing.