just wondering what is your favourite type of loan for IP’s is it IO or P & I ??
cheers,
James.I/O
Cheers,
Aceyducey
Hi,
I’m a big fan of P & I loans as you repay debt and therefore reduce your exposure to increases in interest rates.
I use I/O on commercial deals where P & I is not feasible to deliver a +ve cashflow outcome.
Cheers,
Steve McKnight
**********
Remember that success comes from doing things differently.
**********Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
https://www.propertyinvesting.comSuccess comes from doing things differently
Hi James,
For me – Interest only while I have non-deductible debt. I’ll reconsider my options when this is paid out.
Derek
[email protected]Property Investment Support Available. Ongoing and never stopping. PM welcome.
thanks Steve,
I think given the state of the Aussie market right now i am going to have to use IO to cheat and make some properties positive. Also am considering converting my others to IO in order to gain access to more funding. Any major pitfalls to IO i should be aware of?
cheers.
I use IO for IP’s also
REDWING
“Money is a currency, like electricity and it requires momentum to make it Effective”
Count The Currency With This Online Positive Cashflow CalculatorGreetings All,
As this is my first post/reply I would request that you all be gentle with me . We have a Negative geared property in Sydney which we are now keeping for the potential capital gains. And we have purchased 3 +ve properties in country areas which we have financed I/O . This way was chosen because we are now require to paying the least amouint off per week BUT we will be also paying our XS rents into the loan to reduce the debt. Each $1000 paid earns us $1.24 per week xtra which also goes back into the loan.( Income is not a priority at the present, rather looking down the track 4-5 years. ChhersOriginally posted by camder:This way was chosen because we are now require to paying the least amouint off per week BUT we will be also paying our XS rents into the loan to reduce the debt.
Spot on Camder,
One thing to remember is, just because you have an IO loan doesn’t mean you are not able to pay down the principle , it just means that your minimum obligation is the interest component.
For this reason alone we believe that P&I is too restrictive as it reduces your available limit to redraw later on to invest again.
Personally I would prefer to just redraw the available funds rather than go back to the bank and ask for an extension.
Steve – when you say you pay down the principle on an IP, I’m assuming only after you have no more PPOR debt?
Brendon
Acute Mortgage Reductions
http://www.acutemr.com.au
[email protected]
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