Hi everyone, could someone please explain to me in laymans terms what is actually meant when a person refinances a property that has, say 50k in equity to use on another property purchase. I just need clarity.
Thanks John Gee[:o)]Think & Grow Rich!
Basically they are suggesting that you go to your lender or another lender and increase the current loan and draw sufficient to use as a deposit or to buy outright another property.
Cheers,
Simon Macks
Mortgage Broker
[email protected]
0425 228 985Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.
Thanks Simon, just as I thought. So once you refinance you then have a new loan at a greater amount which will alter your return for that first property as well the refinanced loan would be at todays rate, right? Also what are the implecations when you refinace a current loan that is fixed for five years, are there penaltys? Hope to hear your view, Cheers John[:o)]
Think & Grow Rich!
Correct.
Re: break costs – maybe. It depends what your rate is and what the lenders cost of fund are. We had an aritcle in our newsletter about this. See our Aug/Sept 2003 newletter at http://www.prosolution.com.au/free_newsletter/free_newsletter.php and go to the bottom of the page.
Cheers
Stu
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