All Topics / Finance / equity line of credit – confusion

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  • Profile photo of shay1975shay1975
    Member
    @shay1975
    Join Date: 2008
    Post Count: 6
    May 5, 2008 - 1:44 am

    I have a question about ELOC. Say I have 100k in equity and I access this through an ELOC secured against my property. 

    I can use this 100k as a deposit to purchase an investment property for say 500k. I also have an all in one account. 

    And I believe I then pay interest on the all in one and ELOC.

    My confusion is around the additional 400k which is the cost to purchase the investment property (500k – 100k deposit)…should I not be paying interest on this aswell??? Or is this secured against the investment property or something??

    Totally confused by this. Any clarification would be great

    Thanks in advance

    Profile photo of redwingredwing
    Participant
    @redwing
    Join Date: 2003
    Post Count: 2,733
    May 5, 2008 - 1:34 pm

    Yep, You'll be paying Interest on the $400k as well

    Tenant and tax man help

    Dont forget Stamp Duty, Loan Costs etc…………

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