I am new in investing so please help me with this, I had bought the PPOR worth $300K from Ge loan 4 yrs ago, i have paid off $175K on it so debt was $125000 in end of 2008 then this year february i have bought my first IP(land and home package)in QLD so i have borrowed money from westpac because i was paying high interest ( @7.59 from GE loan) on my PPOR, westpac bank offered me only $319500 to buy IP and total cost for home was $376000 plus stamp duty and leagal cost so what i did i took $75000 from PPOR line of credit and paid to my IP for all the cost so my PPOR back to $200000 and now i did refinance my PPOR as well but from bankwest and break PPOR in to $125000 and $75000 for tax purpose so what my question is it good structure for tax purpose or should i have to move all loan in one single place to bankwest or westpac? or could you please help me for good strcture of loan which is help me get maximise my tax return and better for futre
thanks
Sounds like you have a mess there.
You should keep investment loans and private loans totally separate. Ideally never take money from a private loan for an investment loan. It doesn't matter where your loans are, as long as you have a good rate etc. Just make sure the investment is interest only and you are paying any extra money into your private loan – get rid of it asap. Or, use a 100% offset account against your home loan and save interest there.
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
I am with Terry sounds like an absolute mess to me and a red flag to the ATO.
I would be avoiding the Banks as they would have no idea on loan structuring but keep things simple and separate.
Use an offset account for non deductible debt and maintain good records.
As long as you can support the loan by way of income there is no reason why you should be paying a higher interest rate.
Richard Taylor | Australia's leading private lender
hi
but now i had refiananced my loan with banck west for PPOR month ago at 4.87% and split for $125000 and $75000 interest only for my all cost for invest ment property and my IP $319500 with the westpac bank at the @ of 5.01%, i don't know if i have done mess here then how to get the deposit for the investment property if i don't have to use my equity. still $75000 which i use for investment property i can claim for the tax purpose right for the interest?
thanksTerry and/or Richard,
Do you know of any lenders that will lend on multi unit purchases? I have found a number of unit blocks that are cashflow positive, (Some with very good cashflows that would more than cover all loan, rates and insurance costs with money left over), however, the banks won't lend on these properties or if they will want a forty to fifty percent deposit.
Any thoughts or suggestions would be greatly appreciated
thanks
Sonya
Hi Sonya
Yes i own 2 large blocks myself and have financed many for clients.
If under 4 in the block you will get normal terms and conditions however 4 plus will limited to reduced lvr's.
Richard Taylor | Australia's leading private lender
Thanks for that Richard, I will keep that in mind as I continue to search for CF+ properties
cheers
Sonya
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