My friends make this comment all the time – “Don’t worry about it… it is deductible!”. It is so frustrating!!!

I always respond with the usual comment – “Why pay one dollar today to get half, if that, back tomorrow?”

They still don’t get it.

Definately look at the cost of moving your loan but it is very prudent to regularly look at your loan to determine if your loan product is still competitive and meeting your needs. Tell your friend that I said they are nuts!

I think it is important to look at your investment properties like a business. A business strives to reduce costs and increase profits. Why would you not also do this with your property. Tax concerns should be secondary to the investment process.

The Mortgage Adviser

That is an excellent idea!!!!

The Mortgage Adviser

dmichie, READ IT…. I am referring to the majority of people WHO ACTUALLY CARE!!!!

In response to your comment about those renting, the percentage of first home buyers and investors is also much less than what I offered.

Open your other eye and you will see why any sort of crash is not good for the ‘majority’. Only a few will benefit. Do you not read everyone’s posts who take the time to respond to your repetitive and ongoing posting of rubbish links and negative commentary? Be courteous and stop picking out only the its that support your incorrect assumption.

Put a time on the crash and I am happy to wait until then to see who can say “I told you so!”.

The Mortgage Adviser

dmichie, I wish you would actually read things before trying to make a point.

If 70% don’t care and 10% want the crash you dream of, that leaves 20% who don’t want it. Take away the 70% who would not be counted in those who care either way and that leaves a poll of 30% of the population. As 20% is more than 10%, that makes it a majority. I can’t make it any clearer to you and it does not matter anyway as the person who wrote the article is a nobody who writes great fiction stories.

By the way, you really seem to get excited by going over the same thing over and over again. What is the story?

The Mortgage Adviser

In addition to my last post, Mortgage Down is just an internet marketing site that derives income from website traffic click throughs. Try calling one of their ‘analysts’ or requesting some the ‘anecdotal’ evidence they suggest supports their information. This article has no weight, the company has no actual address, telephone number or offers no evidence of accurate statistical data. This is like posting an article from any old chat forum to support a view and trying to suggest it is accurate.

The Mortgage Adviser

Hey Collie,

Is scotty3 a propert buyer’s agent or just a ‘bird dog’?

Were you provided with a report regarding the property and surrounding area?

How much did it cost you and what was the price of the property you bought?

The Mortgage Adviser

There is a development section on this forum for this type of stuff. There are some geniuses over there that seem more than happy to help newbies. I personally find developing to be too difficult for my own purposes.

The Mortgage Adviser

I would not buy a property for the sake of buying a property. There is not point. It needs to help you grow your portfolio. You would make more money in a managed index fund or property trust.

The above aside, as for the possibility that capital gains may not occur, I would not worry about this if it is a positive cashflow property. People invest for various different reasons. The added cashflow may be enough to help you achieve your more difficult goals.

I would personally stay away from P&I and use an offset account with an interest only loan. There is no point to paying down the principal on an investment property if you intend to invest further. You can keep the funds available in your offset and it will be helpful should your cashflow position take a further turn for the worse.

I would personally not buy the property for the reasons you have outlined. It does not serve you well to buy just to buy something.

The Mortgage Adviser

I corrected my previous post due to the typo. Sorry about that.

Everyone keeps asking this question to me. Either they do not read the previous posts or consider me to be a pretty stupid person. I know I am not stupid so I will assume the earlier posts were not read.

Can YOU see that in the second year using the same interest rate and capital growth rate, the 93k you asked me if I could see would be less due to the interest expense from year 1 which is now capitalising? You even said it yourself that you would run out of equity in about 14 years in this example.

My opinion on this is very simple. These rates are NOT consistently achievable so 14 years in the example we have been using is way over what it would actually be.

I certainly do not have a closed mind on ‘USING’ equity. You said you have used it in the past to focus on ‘INVESTING’. This is totally different to my challenge to this ‘structure’. My challenge to using this structure ONLY applies to ‘living off equity’. My definition of ‘living off equity’ is spending on personal non-deductible expenditure without further investment. It is NOT viable.

The Mortgage Adviser

Would never happen if I was debating!!!

The Mortgage Adviser