I hate to say it is very unlikely that your Financial planner will recommend property as normally there is minimal benefit to him or her in such an investment strategy.

Certainly listen to what they have to say but then look to map your own path.

Remember investing just for Tax effectiveness is a very poor long term strategy.

The other thing to bear in mind is if the Rates are in arrears then it is likely that if the property has a mortgage on the property this will be in arrears also.

It is not merely a matter of paying the rates and ignoring the outstanding mortgage.

Your share in the property and the amount of equity are 2 totally separate figures.

As any loan will need to be in Joint names the percentage split does not matter as you are both jointly and severally liable for the entire debt irrespective of the percentage split.

Duplicated

Yes there are a couple but as I say a lot more informatiuon would be required in regards to the balance of the deal.

Look sorry AW i dont want to appear arguementative but have to totally disagree with some of your comments.

1) The fastest way to wealth creation is to pay off your PPOR ASAP, therefore always P & I.

Have to disagree Interest only with a 100% offset account is the way to go as this gives you flexibility and this is the key.

2) I would rather invest in property shares some of which offer a guaranteed return eg Myers shares were offering 15% guarantee returns

Sorry but again this is clearly incorrect. Coles Ordinary Shares do not have form of guaranteed return. You are refering to Preference shares which carry a coupon note and whilst the return maybe guaranteed the value of the asset will rise and fall according to the fixed interest rate market. It sounds like you do not fully understand fixed interest markets so would careful offering such advice on a forum.

I think AW is getting slightly confused as you state you own 10% of the property with your mother so we would assume the property is held as Tenants in Common.

The loan however is a joint application and you both a jointly and severally liable for the entire debt.

Therefore subject to both parties agreeing to a new increased loan amount and satisfactory serviceability you would be able to access 80% of the current valuation less the existing debt.

What would happen is that you both would lend to you solely the amount raised and therefore the interest position jointly / income received is balanced and you can then personally claim the interest in your sole name (Probably would draw up a private loan agreement) .

Just to correct a few points above:

1) Have you thought about buying a PPOR and having your brother live with you and pay you rent? This way you would be eligible for the First home owners grant which you would not be entitled to if you bought an investment property.

A) Regretfully by renting out part of the home you would disqualify yourself in receiving the First Home Owners Grant as well as any Stamp Duty concession.

2) Redraw on this equity to buy other properties.

A) Regretfully interest charged on redrawn funds where the original purpose of theise funds was to purchase a PPOR is NOT a Tax deductible expense.

You need to have the loan correctly structured to enable you to move forward and most Banks and the average Mortgage Broker would have absolutely No idea.

Ok Demitri thanks for the explanation.

Look dont want to be a a doom and gloomer but if the debt is owned as Joint Tenants then you actually liable for $120K 's worth in the eyes of any lender.

With investment loans capped at circa 90% lvr (Yes i understand there is the odd exception) then you are going to need savings over and above repayment of these external liabiliites.

Unless you have access to equity in the current climate it will be a very long road but formulate a budget and start to whittle away the debt as and when you can. try and consolidate to a cheaper rate of interest and this will give you more disposible income to pay down the amounts outstanding.

Good luck and keep us all informed on how you go.

Richard

Hate to say it is illegal in South Australia with the odd exception.

Needs to be done on a Rent to Buy or similar basis.