Hi,
Just after some advice in relation to finance. We have a PPOR which we are turning into an IP in the next month or so.
In the time we have lived in it, we have released equity to pay for other items eg. credit cards & car. I would like to know whether we can re-finance up to 90% to enable us to use the deductible interest for the whole amount once it becomes a IP? Is this possible?
Thanks,Moon
Deductibility depends on what the borrowed funds are used for. So if you increase the loan to buy something for an investment then it may be ok, but if you increase your loan to get funds for the new house it would not be deductible as it will be a personal expense. Same with the recent increase to pay the crdit cards and car.
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
Thanks Terry, that was super quick response!
We don't plan on buying another PPOR. I just wanted to know if there was a way of being able to deduct all the interest from this previous PPOR loan once we turn it into a IP. Or will be have to separate the amounts that were used for personal & the original amount for the house?
Thanks in advance.
Moon
same principles apply whether you are renting or buying again. Deductibility depends on what the borrowed funds are used for.
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
You must be logged in to reply to this topic. If you don't have an account, you can register here.
