1st timer

How many "loans" are to be set up to achieve this?  My preferred way would be "one small loan" (known as a second mortgage, I believe) against the equity of your home to cover deposit, stamp duty and legals.  Then a separate loan for the remaining portion of the property purchase.  This means that you'll be able to clear the smaller loan earlier if you wish, thus freeing up your main residence from the emcumbering debt. 

Basically you want to minimise or avoid something called cross-colateralisation.  The banks love to cross colateralise your property such that they get as much of it as possible if something goes wrong. 

Let's say you suddenly find yourselves unable to pay the loan on your investment property and the bank decides to take it from you.  You don't want them taking your main residence as well.

Have you organised your loan yet?  Richard Taylor (userid Qlds007 on this forum) is an excellent broker that would structure things beautifully for you.  His website is:
 http://www.tayloredfinancialsolutions.com.au/index.php?option=com_contact&view=contact&id=1&Itemid=79

Hi Finden

Firstly welcome to the forum and I hope you enjoy your time with us.

Appreciate the wrap Jac you are too kind.

As Jac M has mentioned lenders love to take all of the lovely equity in your PPOR as security in such circumstances and for the unsuspecting investor it sounds like the way to go. You will be told that it is easy to organise, cheaper (actually incorrect) as well as keeping everything with the same lender and building a wonderful credit record (again absolute rubbish).

With all of the figures to hand it is difficult to comment but in realty what i would be doing is setting a separate interest only equity loan sufficient to cover 20% of the purchase price of the IP plus acqusition costs (assuming equity in your PPOR allows) and then taking out a separate 80% standalone loan with a separate lender secured SOLELY against the security of the IP.

Once the IP increases in value get this revalued and draw back the equity to 80% of the new valuation.

Use the funds raised to pay down the sub loan on your PPOR which you used for the 20% deposit and eventually your IP will be totally standalone.

Subject to equity of course the process can be repeated over and over again to accomadate further IP purchases.

Structured correctly will mean you have the ability to keep on buying subject to income and not at the whim and a prayer of the lender. There are also 101 other reasons why you would not cross collateralise your 2 securities and if you drop me a line i can give you a list of some of the other benefits. 

Cheers

Yours in Finance  

Great it's been helpful Finden.  Indeed the finance and structure side can be so much better for you financially if done "the best way".  Why not have the best – you've worked hard for your cash, you deserve to hang onto it.  Good luck!