My wife and I are currently in the process of refinancing to a 230K mortgage on our PPOR, I have an investment property by default as i was living there prior to meeting my wife. The investment property is negatively geared and currently owing 170K. I pay extra on the investment property mortgage. If i paid the minimum it would be negatively geared but only just.
I want to buy another investment property using the equity from my first investment property. We are expecting our first child in March and going to one income (75K gross) for about a year. Our new lender on the PPOR isn’t aware of the change in our earning.
Would the lenders now view me as an unacceptable risk to lend to?
Hi booge
Firstly under NCPP you are required by law to advise the lender of any material change to your financial circumstances over the next 2 years so maybe you should be thinking about this.
Ignoring this you should be thinking about paying interest only loan on the IP to maximise your Tax deductions.
In regards to whether you can support a further loan regrefully there is insufficient hard data to carry out an accurate assessment.
Personally if you are looking at purchasing additional IP in the future I would setting up the structure correctly now as when you go back to revisit it you may find that you cannot finance the deal.
This does not mean that you dont declare to your lender that you are going to down to 1 income however it does mean you look at lending options with increased servcieability criteria.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
At the risk of being howled down some things are more important than property.
For what it is worth I would enjoy the birth of your first child (congrats by the way) and let things settle down before revisiting the question of buying again or not.
By all means convert your existign IP loan to interest only but definitely take time and smell the roses.
Probably good advice, the house will be chaotic for a while until we sort ourselves out.
Derek wrote:At the risk of being howled down some things are more important than property.For what it is worth I would enjoy the birth of your first child (congrats by the way) and let things settle down before revisiting the question of buying again or not.
I agree. I'd be enjoying this time rather than worrying about servicing an additional IP.
Cheers
Jamie
Jamie Moore | Pass Go Home Loans Pty Ltd
http://www.passgo.com.au
Email Me | Phone MeMortgage Broker assisting clients Australia wide Email: [email protected]
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