Good ending to this saga…managed to squeeze in a 0.77% breakfree package for current PPOR and new investment supplementary loan…settlement tomorrow.

Asked specificlly to my broker again if he can help and he said he can't help.

I understand there's nothing in it for another broker to assist. If any broker is open to assisting nonetheless, it will be appreciated.

Hi Richard,

I didn't go through a broker back in 2002 and did direct with the bank manager I mentioned above.

The broker I went with for my recent purchase told me these switches between P+I to IO is something I need to go to the bank directly?

Is this sort of loan change something you could do too?

Thanks for your reply!!! I was going to do this myself but it seems my situation requires a broker!

A few questions and full info on my situation:

1) Purchased a place for $600K where I will be renting it out for minimum 5 years before I'll move there through rebuild or extension. Ok with that noted need to make sure you structure it properly.
What do you mean by structure properly?

2) If I had the choice, I would like to go with another institution to diversify loans, especially if you guys say go full fixed option for 5 years…as there is a big difference between ANZ's and NAB's rates for example. However, NAB will not be recognising the equity in my current house so I will not be able to borrow $600K from them (they said I could borrow up to that amount) due to LVR. The will recongise the equity in your home but you would never structure the loan by borrowing 100% of the purchase price secured against both properties anyway. Cross collateralising the loans is inviting problems down the track.
Is cross-collateralising when you borrow money for one property against another? What are some reasons why you wouldn't do it? Is calculating capital gains tax down the track one of them?

Here's my full situation that I will put forward to a broker, I noticed some small errors and missing info above:

1) $600K pre-approved from ANZ.

2) $190K owing on $450K PPR, $260K equity. Loan with ANZ. In VIC.

3) Purchased $620K IP. $35K extra for transfer costs. In VIC.

4) Will swap between living in current PPR and IP just bought in around 5 years time.

5) $220K in cash (offset account of PPR) before $62K deposit for IP…$160K if deposit deducted.

I want to try to achieve the following, please let me know if some of my objectives are not advisable:

7) Max neg gearing for IP

Different lenders for IP and PPR

9) No mortgage insurance to be paid

10) Maintain current PPR variable discount of 0.7% with 100% offset facility. No fees.

11) Need to transfer current PPR and loan to wife before the 5 year PPR and IP swap as my PPR will be positively geared based on current loan amount owing + expenses vs rental income.

12) I've been told that I can transfer my PPR to my wife in VIC without paying stamp duty and still have the loan under my name. I would have thought that for taxation purposes, the loan needs to be transferred to her too though? Should I at least transfer the ownership to her asap in case VIC gov decides to remove the stamp duty exemption between partners?

13) Something that might put a spanner in the works for 11) above is she owns a investment property already which is $300K value with $150K owing. Close to positively geared…I'd say in around 2 years time depending on interest rate movements. She is currently on mat leave as we just had our second child and won't be returning to work part time until May next year. Due to being part time, she'll be earning less than $40K gross per year. So I doubt she'll be able to service both her current IP and take over our PPR? (but at least she won't have dependents on her loans as my 600K preapproval takes into account 3 dependants, my 2 kids and her).

Such a complex situation……………………………..