Hi folks,
just seeking some directional advice on my next step. have used PPOR equity for an LOC to purhase 1st investment property. that's done and i'm now looking to take the next step. is the preferred model to refinance the investment property into a new IO loan and pay down or replenish the LOC? get a bit lost there and am struggling to link my search strings to obtain a clear enough answer. also, is the preferred model w/rental income to push that into the PPOR offset, then into the IO loan as the interest charges land.
regards
Klein
Firstly welcome to the forum and I hope you enjoy your time with us.
Sorry you kinda lost me mid post.
Did you purchase the IP using a LOC in its entirity or only to fund the deposit and acqusition costs ?
If you did you may have an issue and suggest you clean this up immediately.
Are the loans crossed ?
I recommend to clients to have all forms of income paid into the 100% offset account and have this account feeding the other loan accounts even if they are with separate lenders.
Richard Taylor | Australia's leading private lender
Qlds007 wrote:Did you purchase the IP using a LOC in its entirity or only to fund the deposit and acqusition costs ?
If you did you may have an issue and suggest you clean this up immediately.
why is that???
that is exactly how i got my first INV property, through a LOC on my PPOR house.
everybody has told me thats the right way of doing it…………or is it not?
and i actually tell others thats what they should do.i think im learning more from you guys on this forum than from anyone else
just to clarify, i only used the LOC for the deposit and fees such as stamp duty.
or did you mean its a problem if you use a LOC for the whole purchase?
I only used the LOC for the deposit and fees such as stamp duty – That is fine.
I would also be careful about giving others advice if you are not licensed to do so.
Richard Taylor | Australia's leading private lender
oh yeah for sure, i only meant like my close friends and family.
well thats good then……thanks
Morning,
Thx for the responses so far. Yes, bought the property and all aquisition costs under the "advice" it was the way to go. was uneasy but we moved fast (faster than i was comfortable with to be honest). LOC was secured via PPOR equity, no relation to the new property. realise i need to make a move or even as you suggest cleanup, so am all ears on my options and preferred model/plan.
any and all feedback very much appreciated.
regards
Hi klein
Finance markets have changed a lot over the last few months so would need a little more information to provide structured advice.
Probably have a little bit of appreciation anyway in the IP so may not be a bad time to look for a clean up so you can progress on your investing journey.
Drop us a email if you want and i can throw in some comments.
Richard Taylor | Australia's leading private lender
klein09 wrote:Hi folks,just seeking some directional advice on my next step. have used PPOR equity for an LOC to purhase 1st investment property. that's done and i'm now looking to take the next step. is the preferred model to refinance the investment property into a new IO loan and pay down or replenish the LOC? get a bit lost there and am struggling to link my search strings to obtain a clear enough answer. also, is the preferred model w/rental income to push that into the PPOR offset, then into the IO loan as the interest charges land.
regards
I don't think it matters too much. As long as you only use the LOC for investments you should be ok. If your new IP has equity, then you could increase the loan and repay the LOC or you could set up a new LOC on the IO and use this for the next one.
One thing it watch out with a LOC is the potential for a margin call or a sudden request by the lender for you to reduce the balance.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
thankyou both richard and terry
richard – will ping you offline
terry – am thankfully in a position to "respond" to the bank should something like that occur (though would clearly prefer that not to occur)
and i am probably similar to many people in being time poor. both our jobs are demanding such that they are the focus, not investing … if that makes sense. frustrating to watch things pass by so am doing my best staying up late all the time to catch up and fill my head w/info.
again, thx for your feedback
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