Hi,
Im currently organising a loan for my first investment property. I have about 300K equity in my own home. I intend to borrow 100% for the IP plus fees & charges. I also want to borrow a little extra to pay off my car loan and some renovations.
Can I leave my current home loan at the same amount and borrow the extra cash for IP + expenses?Hi Beast,
Yes you can borrow extra for expenses and the IP,
If you are extracting equity from your ppr for the purpose of investment then I would suggest you structure this as a split loan,The 1st split will contain the PPR loan and any other non deductible debt e.g. car loan etc, and the 2nd split will contain the investment portion, 20% deposit & stamp duty etc, you should also look at attaching an 100% offset to the non deductible portion of the split, Cheers.
Regards
Steven
Mortgage BrokerMobile Mortgage Market
Ph: 0402 483 216
[email protected]
http://www.mobilemortgagemarket.com.auPLEASE note comments made should not be taken as specific taxation, financial, legal or investment advice.
Hi Beast,
I forgot to mention the following..
consider the benefits of interest only repayments on all deductible debt and principle and interest repayments on non-deductible debt, as this can help increase your cash flow & serviceability over future lending, cheers.Regards
Steven
Mortgage BrokerMobile Mortgage Market
Ph: 0402 483 216
[email protected]
http://www.mobilemortgagemarket.com.auPLEASE note comments made should not be taken as specific taxation, financial, legal or investment advice.
Thankyou mobile mortgage. I was told it was illegal to add extra expenses on my IO investment loan because I would be claiming tax benefits.
Is this true?Hi Beast,
Different issue – you can top up the loan, you can’t claim the interest on the portion that applies to personal, rather than, investment debt. Hence Steven’s suggestion to split the loan into two parts to make tax return preparation a painless process.
Derek
[email protected]
http://www.pis.theinvestorsclub.com.au
0409 882 958Edit: actually I just read your response properly and relised you answered my question above. So I will need to increase my current non deductable loan (principal and interest) by the amount I need to cover my car loan and renovations.
Thanks Derek and Mobile Mortgage. [biggrin]
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