I am borrowing 315k for a house with a big shed on the block. The house for rental and the shed for my business. Unfortunately it will be neg geared. Although can be written off. Plus has opportunity to develop the block in years to come.
My account says P & I for the loan. My other IP is pos geared and is Interest only.
Any one got any ideas?
Thanks
RoboDo you have any non deductible debt?
What was your accountant’s reasoning?
Do you have plenty of cashflow?
Lastly, have you got the right loan product?
Cheers,
Simon Macks
Mortgage Broker
http://www.mortgagehunter.com.au
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.
Hi Mortgagehunter,
Answer to your qyestions.
1. 178k on own home.
2. Havn’t asked him yet.
3. Yes
4. Who knows? Nab Mortgage choice package, same as other IP and PPOR. No cost.Thanks
RoboNAB Choice Package is as good as most. No problem there.
If you have non deductible PPOR debt then wouldn’t it make sense to pay all of the principal payments into that loan and reduce it whilst still claiming the most you can on your tax? You are still reducing your overall loan the same. Just keeping it more efficient.
What do others think?
Cheers,
Simon Macks
Mortgage Broker
http://www.mortgagehunter.com.au
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.
Hi Mortgagehunter,
Yeah thats what I was thinking.
Thats why I did IO on my other IP. I will Quiz him on that. Thanks for your thoughts.
Robo
http://www.bestclad.com.auHi Robo,
If I was in your shoes I would certainly be paying I/O this new property and would continue to do so while your PPOR has a debt attached to it.
I don’t know how much faith you have in your accountant but if he is wanting you to reduce your debt levels you will be able to point out that you can direct the extra repayments that were otherwise being directed to your new property towards your PPOR non-deductible debt – that should keep him happy.
I would certainly ask why he is suggesting the P & I loan – he may have a valid reason but based on the information provided I can’t see it.
Derek
[email protected]Property Investment Support Available. Ongoing and never stopping. PM welcome.
Question your accountant thoroughly. As others have pointed out, it should make better sense to pay principal off your home, rather than a tax-deductible investment.
And if your accountant can’t provide you with sound reasons for his recommendation, sack him!
I’ve heard an abundance of total crap come from accountants, as told to me by various clients. I’m sure there are great accountants out there, but there are plenty of lousy bean-counters as well!
Max Hugen [email protected]
Alpha Financial
Residential & Commercial Loans
http://www.alphafinancial.com.au
02 9560 3061
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