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Geez this forum USED to be rather helpful
Thanks guys,
I will rang the Bank today and inform them that I am selling one of my houses and see if they can change the loans over in time, *please* *please *please*. Had a thought last night though…. if they can't be changed over in time I might be able to borrow $20,000 on the remaining $230,000 to bring it up to $250,000 and qualify for the offset loan. We will probably spend another $10,000-$20,000 on our house renovations anyways…
I think it is worthwhile having a loan with an offset facility as the profits from my IP sale will sit in there and offset our PPOR loan. Our PPOR will probably be an IP one day so I will get the tax advantages later down the track, doing it this way.
Also wondered last night…. what's to stop someone refinancing/borrowing more money on their loan, only to put it in a (linked) offset account… i.e. to increase the loan debt…? We would probably put the $20,000 into the offset account and then use it as we need to… but it just got me wondering. I suppose you could try it but then if you ever got audited by the tax man…..
Cheers….
Thanks Elka,
Nah, not auctioning it….selling privately….my sister has been showing people through, etc and I'm going to give her $5000 or so for her time and effort….probably less than half of what an agent would charge, and the money's staying within the family
Cheers
Hi Elka,
As much as I have debated that exact scenario myself (whether to sell my IP or not) I think, in the end, I feel like I don't have much choice at the moment. We are struggling with cash flow and have been borrowing money from my Mum's equity loan (this is where we've been using money for our reovations) just to cover everyday expenses such as food, fuel, etc. We are by no means living large, but we are still struggling. I could try and negotiate going back to work early, but I really don't want to….I think I would really regret it later. Our little girl is already growing up way too fast, I want to spend as much time with her as possible at the moment, she's only 10 weeks old.
With all that said, my IP is already on the market LOL, has been for 1.5 weeks AAAANNND to my greatest delight (and surprise I must say) properties in the suburb where my IP is are HIGHLY sought after at the moment. As a few local REAs have said "they are going like hot cakes!" Within 10 hrs of the first Open House (yesterday) I have already received an offer… $1,000 above my asking price!!
I couldn't believe it. AND there are 6 other parties really interested. So yeah, houses are most definately still appreciating in Canberra. I could maybe even get $20,000 or more for it in a few months time but who knows, I could be wrong.I was only just thinking about getting another IP, at this stage. Something small, like a 1 bedroom unit where I live now. I think the area where I live now is really going to boom in the future. I would need something that pretty must looks after itself, so we are not putting in much money ourselves (or else I'd end up back at square 1 with the cash flow situation) but I want to put the IP sale profits into an offset account so I don't think that this is going to work…hmm might have to have a more in depth chat with a MB.
Thanks for your thoughts!
Hi Elka,
Yes, there's a reason. After selling my IP and putting the profits into an offset account linked to our PPOR loan, I wonder if I'd be able to buy another (cheap) IP by securing it with the 'equity' in the offset account…..I would want to borrow 100% of the property price plus costs (if possible) to make the IP loan as high as possible…
What are your thoughts on this?
Thanks
Anyone?
Elka, thankyou. I always understand your posts, they make sense
I don't know why I didn't just think of that before. Continuing our current repayment amount, using money from the sale. I don't know why I had it stuck in my head that I somehow had to reduce our set P&I repayment amount LOL, derrrr!
I have to look into how much it would cost to change our loan to one with an offset facility (100% preferably), and what the interest rate would be on that new loan, the fees to change the loan over, etc. We're currently with Bankwest and the interest rate is 7.40%.
I do think it's the way to go though, even though after talking with hubby the other night we're not sure now that we would turn our current PPOR into an IP one day. But at least if we do it this way, we have the option. It would also suit us really well to have access to the profits in the offset account (therefore not having to pay a redraw fee each time) as we are still completing renovations (and spending thousands) on our PPOR, though we're almost done!
"You can stay home with your baby for as long as you like."
Ooohh, as wonderful and tempting as that sounds, wouldn't we get too far behind (financially)?Thankyou again Elka, for pointing out the obvious to me!
I just thought of a very easy solution to my problem, it's so simple I can't believe I didn't think of it before LOL. I'm blaming the nappy brain!!
With the profits from the IP sale, I will just take out $10k to cover mortage repayments for 8 months (or until I go back to work) and then the rest of the profits into the loan…. EASY!
I couldn't believe it. AND there are 6 other parties really interested. So yeah, houses are most definately still appreciating in Canberra. I could maybe even get $20,000 or more for it in a few months time but who knows, I could be wrong.
