Hi all!

I finally met up with a mortgage broker yesterday. He recommended me to go for the I/O loan to pull out my equity.
One thing he mentioned is the involvement of my wife in all the loans to draw the equity out of my current house because the house is under my wife’s name only. So she has to guarantee all the loans (Technically I don’t have equity)
I’m thinking of going to the conveyancer to add my name as joint owners of my current PPOR. Will that actually make life easier where I can loan without getting both of us (wife and myself) involved in the process?

One more thing he mentioned was I’m still limited to how much I can borrow – it’s solely dependant on my income.
So for example, based on my salary I can borrow $400k from a bank. If I buy a $350k house (Use $100k equity from PPOR to loan and pay the deposit /fees and $300k from a bank loan), I’ve pretty much used up all my borrowing capacity.

Even if i have $300k left of equity from my PPOR, I can’t borrow more because I’m limited by my salary. Is this true?

Happy to hear your thoughts and guidance. Thanks again.

Andrew

Hi Terry,
I thinking of getting the LOC under my name. What will be the pros and cons of using my name and not my wife’s name? My initial thoughts were to start my investing journey solely under my name/trust.

Good to know the LOC will be tax deductible. If I use the LOC loan for my deposit, I understand that I will be charged a higher interest. Should I try to pay interest off the LOC (deposit) or the normal loan first? If I pay the LOC loan, that means I can use it for another deposit?

Hi Jamie,
If the LOC is a liability and might impact on my borrowing capacity in the future, do I actually have a better chance of borrowing more with an IO loan with an offset attached?

Thanks for your help guys!

Andrew

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