Thanks Hellman,

So is the thinking the same when it comes to general residential property?

Once you get a few IP’s under your belt, is the bank still “assuming” you need to cover the repayments on every single one out of your income?

And so basically, it would be better, easier and possibly?? just as profitable to look elsewhere (outside inner…[Read more]

Hi Leo777,

From my understanding through MortgageHunter and grossrealisation here and talking to my broker again, you will be servicing the ENTIRE debt.
So in your equation below (in theory), BANK A’s loan will increase to 200K and BANK B’s loan will be 185k.

The 65k equity you drew out and the new 185k loan should be interest only and is…[Read more]

Thank you Mortgage Hunter.

Yes I understand now. Sorry just confused me a bit when Grossrealisation said “Equity is exactly that there is no cost or interest on equity”.
I interpreted that as “no repayments on equity”

So overall, it’s a matter of serviceability and if you want to be +geared, then finding a property that covers (rents out) the…[Read more]

Hello Mortgage Hunter,

Thanks for your reply.

This is where I get confused however…the 50K that I withdraw (seemingly from thin air – ie. an increased valuation of my property)… do I repay this to the lender AS WELL as the other 150K I would have on loan for the IP???

Here is my story in brief:
MY PROPERTY:
purchase: 155K
loan:…[Read more]

The place in my building would only go for around 200K (small 1 bedder) but could rent at probably $250/week.

If I use my 50K as a deposit, that would be 25% of total sale which should be ok for lending mobs shouldn’t it?

Thanks!

Hi Grossrealisation,

Thanks for your answer. Well that’s what I thought BEFORE I went and saw the broker.

I thought that if someone had equity built up either through repayments or increased valuation, then that was there’s to draw out without having to pay back?

So basically if I have roughly 50K equity in my current home, I can use that as a…[Read more]