Hi Richard,

Thanks for your advice, just in the nick of time, I spoke to my lender and am fortunate I asked the question this morning. He advised that as we are borrowing 100% of the loan, $195K of the loan is secured on our existing property and that was the only option otherwise we would have to have mortgage insurance (which could cost 15k). So even if we paid off the $60K on our existing property we couldn’t get the deed until the $195k was paid.

Anyway, I thought about it and we have land with a beach shack that is worth about $200K (which we own) and suggested could we put the $195K on that.

He advised it could be a possibility if we get it valued and put a mortgage on that. I have been tied up with work so will be discussing this with him tomorrow. What do you think?

Also I am getting pressure from family (to put the IP under husband’s name as we will be losing 1000’s in Tax benefits). I haven’t had time to organise seeing an accountant and will be signing paperwork on Thursday. Should I just put it under his name and write up an agreement with the solicitor that property is 75% mine/25% his if circumstances change. I really wanted something that I independantly owned.
Regards
Tesst

Thanks Jamie (Pass Go Home Loans) & Richard (Taylored Financial Solutions)

Okay, I understand what you mean by cross collateralisation. I will look at the Loan Application and speak to my lender tomorrow. This information is extremely valued and is providing me with some insights into how investment loans work and what a risk it could be to my existing property.

Richard, I will email you re the article in the API magazine, thank you.

Jamie, I have looked up House of Wealth and they are not far from where I work so I may give them a call – thank you.

Regards
Tesst

Thank you to Yours in Finance and Women In Property for your feedback, it is much appreciated.

The existing property is not so much security, but our Lender wanted to ensure that we had enough equity in our existing home to be able to borrow the full amount needed to purchase this property.

Using the redraw facility for a deposit was the only option I had. Do you mean I have contaminated my existing mortgage’s interest? I do hope to structure the loan as effectively as possible, though am learning on the fly. Thanks for understanding my reasoning, it is important to me.

I do understand negative gearing is the best advantage, but in the long term, it may be simpler to have something in my name. I would like to start creating my own wealth.

Are there any other options for tax benefits that can be utilised using the low income earner instead of the higher income earner?

Is the Accountant in Melbourne?
KInd Regards