I have two investment loans with Homepath, and are very pleased with the low interest rates. The loans were refinances from other lender for the lower rates of Homepath, and the drawing of increased equity in properties for investment purposes. Organising the loans was straight forwards. After the initial internet application, express post of documents by Homepath was employed. The loans did take a while to settle, about 8 weeks from application, but as refinances this did not matter. No documents were lost, and any enquiries on status of loan was a simple phone call to the lender, up to 10pm at night.

As to the loans having no features, well they have the features that I required. Low interest rate; variable; interest only; no application fees; no break costs at the time I signed the contracts; direct debit repayments. They have redraw feature which is not relevant when paying interest only. Topup is now available to draw on increasing equity. No offset savings accounts are available, but then I don’t want offset on my IP loans, as I have offset savings account linked to my PPOR loan with another lender. Also have LOC with other lender.

So when one has another lender to provide loans with features complementing simple Homepath loans, Homepath becomes a viable source of cheaper IP funds.

Tasman

Stuart,
Referring to Wizard loans, restricting repayment periods to monthly does not mean the loan is more expensive than another variable loan paid fortnightly. You can simply increase your monthly repayments to whatever level your budget and planning allows to achieve your goals.

Cheers

Tasman

Hi Kwilko, your have listed some likely IO loans without any justification other than their most important favorable interest rates. However your statement that they are base variable rates is incorrect. All the package loans you refer to are discounted rates. I suspect when you refer to ‘discounted’ your are refering to honeymoon discounted rates. ANZ, CBA, National, Westpac and St George base variable rates range from 7.07% to 7.17%, hovever they all offer permanent discounts varying from 0.4% to 0.7% in package offerings.

Non bank lenders appear in advertisements to offer better rates than most banks base variable rates, as their advertised rates are already discounted, whereas banks package discounts have to be ‘revealed’.

Nat, why don’t you try infochoice.com.au/banking for listings in spreadsheet of lenders and rates. You can sort tables of lenders by column headers, ie; interest rate, lender, other loan features. Bear in mind package discounts need to be applied to most bank offerings listed.

Homepath.com.au(owned by CBA) has loans at 6.15% and is listed as top ranking for advertised loan features by a few sources.

However what is really best for you depends on your circumstances which you have not posted, and if you do not have time or inclination to research, a broker could be a very good option.

Cheers

Tasman

Hi all,
The auto linking of defined words for site advertising within subscribers/contributors posts is unauthorised by contributors, and could be confused with subscriber links, and also construed as the subscribers advertising or advertising specifically endorsed by subscriber.

PS Obviously in a land and house package, depreciation expense is not applicable until the house is complete, other expenses such as interest, and council rates are applicable.

Tasman

Misty1
Clarification needed. When you obtain a property,if your intent is to rent that property, then you can claim costs from the date of settlement even if it is not ready for rental, eg; with house and land package you can claim expenses from land settlement date while the house is being built. You must follow through with renting when the house is complete/renovated or whatever for pre-rental expense claims to be valid.

cheers

Tasman

Misty
The withholding tax variation form can be accessed online by the following link:
“www.ato.gov.au/individuals/keywordlist.asp?k=Variation”.

The ATO provide an online form that you can fill in, save and edit at your leisure and submit when ready online to the tax office. The ATO then process the form and notify you employer pay staff in about 2 weeks from submitting your online application. This is a much better option than filling out the form and mailing. Turn around time on this could be up to 4 weeks with ATO.

The turn around time between notifying the ATO and effective date on your pay, will increase if ATO notification misses the next pay days cutoff for variations to your employer.

As your financial situation changes, or you re-calculate your previous submission, new variations can be sumitted to the tax office. Another reason to submit online applications that can be actioned promptly.

The variation form is similar to TaxPack or
E-TAX forms so you need estimate your annual income and estimate all your significant deductable expenses.

You can under estimate your expenses if you wish to be conservative, but I like my claim to be accurate, as why should I over-pay tax contributions? This strategy maximises funds available for expenses or interest on my funds.

On the other hand if you over estimate your expenses and underpay your withholding tax, then the ATO does allow a small margin without penalty. As after all, this variation is an estimate only, of all your income and deductable expenses.

Tasman

Hi Rob,
I think your above recommendation about being able to claim all IP expenses on a property rented at a nominal rent is incorrect. Refer to the ATO Rental Properties publication document (NAT 1729-6.2002 or later version) on Non-commercial rental. If you rent a property at less than commercial rent then you can only claim expenses up to the rental income received.

Tasman