HI Everyone,
Hope you can help me think this one through:
I am about to buy an NRS property at $370K – about $1820 p positive cahsflow (after tax breaks etc.)
no mortgage on my PPOR – $800K.
owe $104 k on a 400k property at about 6.7 %pa with CBAI intend to buy at least 1 other investment property
Here is the question s – should I go with IO or P&I
LOC or ordinary variable LoanThanks
Hi Tb
Firstly welcome to the forum and I hope you enjoy your time with us.
Personally i would go interest only 100% Offset account or at least IO and have the offset account on your other IP.
I will assume that you dont intend to cross collateralise the securities or use your PPOR as security and will set up a sub loan secured against your other IP then look to do a standalone loan on the NRAS property.
I have seen many a NRAS property been down valued and Banks / Brokers love to suggest you cross collateralise the property with your PPOR or even use this as security to avoid finding out how much the NRAS property has been down valued and how much commission the NRAS salesman is earning out of you on the deal.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi qlds007,
Thanks for responding to my call for help – really appreciate it.
I intend to use my existing Investment property as collatoral. My PPOR will be not be used as collatoral . I intend to use 100 % offset facility – thinking of st George portfolio – advantage saver- They have offered cheaper discount .
I was thinking of refinancing from CBA to my new lender .
Are you suggesting I have 1 loan with CBA and use equity from there to put towards the new investment and another with a new lender? Total three loans ?
I am assuming if i have a loan like STG Portfolio line of credit loan (6.7 somthing %) that any of the splits under it will be cross collatorailsed?Thanks againe
tb007 and QLD007 – is there a trend forming here?
No need to use your entire IP as security for the next.
You just need to access enough equity in your current IP to cover the deposit and purchase costs on your next IP – you can then source the remaining funds from the same or another lender as a separate interest only loan.
Don't know if I'd be refinancing to the STG portfolio.
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]
HI Jamie,
Thanks. Its been a long time since I purchased an IP.
The non cross collatoralisation is starting to sink in.
What are the features I should be looking for if not a portfolio/advantge saver type of loan?
I ahve looked at State custodians; NAB homeside is also offering cheaper loan.
I have no other loans besides my current 100K on my 400k property?Thanks
PS as far as trends go, James Bond has a lot to answer for as far as influencing pop culture!
Hi there
I don't know what you currently have with CBA but I'd be looking at that first. Probably do an increase on that loan (can be set up as a seperate interest only loan or LOC) – this will act as the deposit/costs on IP 2.
I'd then set up a seperate interest only loan for the remaining funds required – probably with another lender that will offer a fully transactional offset (CBA's MISA, which is their offset is ok, but has limitations).
Using the STG portfolio as an umbrella loan for multiple properties can turn into a dogs breakfast.
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]
Agree with Jamie the SGB Portfolio product can cause more trouble than it is worth as an IP loan and their service stinks at the moment.
Think i would be working backwards:
1) What lvr can i get on NRAS. Likely to be between 70-80% max and who can i get it thru.
2) How can i raise the balance of my deposit and acqusition costs. Look to refinance the existing CBA loan initially (at 104K they are not doing you any favours or rates or fees) and maybe take out what i need for the deposit on this one and the next IP.
You only need the 1 offset account so the other loan can be a no frills style product.
Re-structure now to set yourself up for #3 when it comes around.
Must admit a cool miserable day in Brissie today and feel sick as a dog i think i could be Sean Connery and tb could Daniel Craig.
With a sore throat i even sounds a bit scottish this afternoon.Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
HI Everyone,
Thanks for all the expert advise.
CheersTB007
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