Yes as Terry mentioned you are looking at between 7-8% for Lodoc 1 day + from 60-80% and Nodoc probably 7.5-9% for upto 70-75% LVR.

Hi Luke

It is difficult to comment without all of the information to hand but must admit i am an advocate of using a Discretionary Family Trust where appropriate.

In saying this of course if the property is negatively geared many clients need to rely on the cash flow they receive from lodging a Tax variation form and also the non cash deductions such as Depreciation and Capital Allowances.

Such deductions are not available within a Trust structure.

If the property is neutral or cash flow positive then it may not be so important.

Either way you need to structure the loan correctly to avoid cross collateralising the loans and to maximise your interest savings.

AFG take the average broker who has been around for 5 minutes and is probably wanting a lot of hand holding.

The sort of Broker that deals with a lot of mum and dad First Home Buyers.

Basis on this i can understand the numbers.

Your more sophisticated Broker whose clients are made up of investors, higher net worth clients with some equity is probably busier now that ever before with the demand for finance. I know my levels are up 160% for Jan compared to this time last year.

Terry is right however as soon as mortgage insurance is mentioned expect to put through the ringer.

Why not post a few of your questions on the forum and we can then answer them for you at least this will give you a heads up before you rush in.

Remember if you intend to buy a house for your PPOR the interest wont be Tax deductible so ideally you would want to reduce the non deductible debt and increase the deductible debt.

There are a couple of ways to achieve this but all depends on the numbers as Stamp Duty maybe incurred.

Wow Dylan just hold on there.

Please dont take the funds from a redraw on your PPOR otherwise you will have real issues in trying to claim interest on the funds as a the original purpose was not for investment. 

I suggest you would open up a second account i.e line of credit and use this to cover the deposit.

Then take out a separate loan probably to 80% of the purhcase price on the new IP.

Keeping it clean now will save you a lot in the long run.

Of course it goes without saying please donot cross collarteralise the securities.
 

Hi Karen

Yes a DFT can be an effective tool when you are either acquring positive geared properties for the long hall or looking at carrying out short term buy, renovate and sell projects.

Funding such deals can sometimes cause issues especially if lenders believe you are doing the deal purely for profit however structured correctly you should be able to do this over and over again.

grafty

Not sure whether Tax advise is going to help you that much because if you cant finance it it doesnt mean anything.

Why would you not consider selling your interest in the current PPOR property to your hubby and then use the raised funds as deposit on your new PPOR.

Then with the additional equity by all means look at a separate investment LOC to use as deposit for another IP.

Normally if it is done under the "Love and Affection" clause you may find there is no Stamp Duty payable but this varies from State to State so a quick call to your OSR should answer that one.

By the way having both an IP loan and your PPOR in 1 LOC is not particulary smart going forward especially if you are trying to convince the ATO that you want to claim the interest on the property. Split loans always work better and I would use an LOC for your own PPOR.

Terry very a true word.

Of course when you are out with the lads at the pub and the wife phones and you tell her (like the Carlton Cold ad) you are on your way to an appointment and will be late home that doesnt count.

Hi Peter

Think your biggest issue could be income and proving serviceability.

Remember lenders dont like full time renvoators or developers and the bar is a lot higher to jump.

Get your mortgage broker to set you up before you go and you should be right.

If the deals are to buy, renovate and sells then you might want to look into the world of Trusts.

More flexibility, more asset protection and done properly not an issue to finance.

Terry has hit the nail on the head buying using an instalment warrant can still be fraught with difficulty.

Only one lender in Australia does not require the Trustees of SMSF to give a Personal Guarantee and their lending terms and credit policy are not straight forward.

Just to correct Ben's post 10% is the concessional CGT rate a SMSF pays on the sale of a property and this is only applied where the asset has been held for 366 days otherwise it is 15%.

Sure i manage my own Super fund and sure i own property within the fund but this forms a mix of assets i hold and certainly would not recommend to any client use all of his / her retirement funds to purchase property. 

Think twice before you are convinced this is the only strategy to adopt with your money.