Hi Richard,

Apologies for the poorly written piece earlier. In clarification, I have 2 positively geared properties currently cross collatoralised. The original loan was $200k. I have been putting the excess positive cashflow plus additional funds back into the loan such that the current loan remaining is at $100k. The properties has been valued by the bank at $125k and $115k respectively.

I would like to reduce the debt to 0 within 3 years. My strategy is to utilise renovations and subdivisions to achieve this. As i understand it there is an amount of equity that can be drawn upon on the current loan structure that can be used to finance a property flip deal. I guess my question revolves around the benefits/disadvantages around putting the remaining $100k loan solely onto the $125k property (80% LVR) and removing the $115k property into my own name. At which point i draw down on the equity in the $115k property to finance the flip deal, versus keeping the properties cross collatoralised and drawing down on the current loan equity.

Any help here would be appreciated.