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Thanks for the feedback everyone.
i was actually planning on using the redraw for a wedding.
Derek, i bought the property because a family friend was selling it for under market value for personal reasons. i bought it for $250k and its worth close to $300k. i've only had it for a year an a half.
I think i'll switch it over to IO with an offset for the principle.
Thanks again guys
hi derek,
the garuantor part of the loan is $155K (20% deposit). Effectively we have 2 loans the $155k deposit and costs then the $536k for the remainning 80% of the house.
We were thinking of renting it out for a year at interest only, to maximise our tax deductions, during this time we budgeted to easily save $50k between us or more in a savings account. when the year is up we were planning to put what we have saved into the 155k loan then CBA will let us refinance the remaining $536k loan to be 95% of the property and paying off the rest of the 155k and releasing my parents as garuantor.
Then we we do what Jamie suggested in his article and and out any extra repayments in an offsett account.
what do you think of this approach?
Thanks Jamie that was a great article, very insightful.
At the moment we have not looking at the property as an investment as we bought it as a family home but will definitely do the off set account option as per article when we move in, just in case we change our minds and need a bigger place.
thanks guys, been very helpful much appriciated
