Depends – is the total package under $1mil?

Regards

Shahin

That's incorrect as I have done numerous this week but max was 1.00%. 

The thing you need to understand is that the discount doesn't mean anything – you need to look at the actual standard variable rate to start with. If you do this you will realise that the 1.00% discount off ANZ's rate is great vs the other majors.

Regards

Shahin

Here is an example of what I mean:

Existing Property:

Loan A/C 1 – $x (Purpose is the 20% Deposit for the IP purchase – this will be tax deductible as the purpose of the funds are for the purchase of the IP)

New IP Property:

Loan A/C 2 – $x (Purpose is 80% of the IP purchase – this too will be tax deductible as the purpose of the funds are for the purchase of the IP)

You will need to submit 2 separate applications to ensure that the bank doesn't link the properties and in turn have more control of your properties than they need to.

Regards

Shahin

That is a lot of equity but I think you mean 80%. Is the property unencumbered? 

Actually the answer to that question is irrelevant. The point is you have equity. You need to ensure that the structure of the loans are correct and you set up the loans standalone (i.e don't cross securitise). 

Regards

Shahin

Its not a very stable strategy to purchase property based primarily on negative gearing. Why do you want to lose money and hope for CG in the future? 

There are no issues with negative gearing however have a plan to turn it into either cashflow positive property or ascertain CG/equity to build your portfolio from there. 

You can claim one property at a time as your PPOR so look at your longer term plan it may worthwhile living in the property first and then renting it out.

Regards

Shahin

In the name of everything that is holy and sacred what is this drivel? 

I have to hand it to you John or Rob – you keep getting taken to the cleaners and you just keep coming back for more. You have skin thicker than a rhino's backside.

Regards

Shahin

The biggest thing you need to consider is site costs. Secondly, no matter which builder you choose – you will find that you will always need to keep an eye on the development/construction.

Regards

Shahin

Do what Terry has stated plus go IO.

Regards

Shahin

Do you have a report on recent sales that could be used to potentially negotiate the property down?

Regards

Shahin

This is a scenario where I would recommend that Joey ascertains the loan for the deposit from their current lender since she has paid LMI with the current lender. They can get valuation upfront with another lender but the val would need to come back at $500k for it to be feasible (I don't think it hurts getting a val via ANZ since they do modelled estimates a lot of the times).

Regards

Shahin