Hi everyone,
have just put an offer for an IP near pointcook vic.
Offer is 340k
I want to have some help/suggestions as to how do i setup my loan account to suit the best outcome for me. plan is to buy a another ip/own house in next 2~3 months time.iam on high tax bracket.
- Which banks offer the best.
- should i go for fixed or variable ? why?
- how much should i pay initially is it 5% or 10%? which works best?
- is LMI(mortgage insurance)tax detectable?
- how should i structure the loan so it fits current and future purpose(buying own/IPs)?
- once the settlement happens what all can i start claiming in for tax?
- house is 20 years old so how to go about depreciation?
- is buying a new house better or old house?
- if iam fixing some basic stuff in the house before renting it out is that cost tax claimable?
- any excel sheets to keep track of spending/income from the IP?
- anything else that i need to be aware off?
I know its lots of questions.. but iam new and trying to get my head around all this and i feel i can get the help from veterans who know how all this works.
thanks
Smartcube
In regards to the loan itself, should be setup up as interest only and with offset (unless you have a PPOR loan in which case the offset in the linked to that).
As for fixed or variable, personally I don't like fixed for the very reason that life is full of surprises, and you don't know what may happen in the future (which may cause one to break a fixed rate loan incorporating high break costs). Though it is a personal thing.
LMI is deductible over either 5 years or the end of the loan, whichever is shorter.
Cheers
Tom
Smart,
Tom has answer a couple of your questions but hate to say without full information it is difficult for anyone to give you a recommendation as to which lender is going to suit your circumstances.
I can think of more than 1 lender i would avoid and a couple i would certainly recommend.
In relation to the lvr you might find getting 95% harder than you think unless you have a good asset base or other factors going in your favour but as i say almost impossible to commend further as we don't have all of the relevant information.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Qlds007 wrote:In relation to the lvr you might find getting 95% harder than you think unless you have a good asset base or other factors going in your favour but as i say almost impossible to commend further as we don't have all of the relevant information.
Sure are – I'd like to avoid 95% deals altogether if I could. First it has to get though credit scoring….then the assessor….then LMI. It's amazing the difference in scrutiny a 90% deal will face in comparison to a 95% deal.
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]
Couldn't agree with you more Jamie.
Must admit for a new client without a track record i politely tell them i can assist at 95% lvr.
The number of grey hairs is just not worth it.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi Qlds007,
Thanks for your reply.. i am with NAB for last 10 years… i spoke to them they recommend NAB Choice Package. they say they will offer 6.00% interest. annual fees is $395 with first year free.pls let me know which ones are good.. and what other info do u need?
thanks
smartcube..
Hi Qlds007,
Thanks for your reply.. i am with NAB for last 10 years… i spoke to them they recommend NAB Choice Package. they say they will offer 6.00% interest. annual fees is $395 with first year free.pls let me know which ones are good.. and what other info do u need?
thanks
smartcube..
Smart the NAB Choice package is par for the course.
Personally i don't like to recommend the IP loans are with the same lender you hold your PPOR.
Even if you do go with NAB make sure they don't cross the loans as they will certainly try to.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi Smart,
You are now at the stage where you need to get a good broker as part of your team.
A bank's first priority is always to the bank – not you. By comparison if you get a good broker on your team they will help you build a finance structure for short and long term. A bit like building a brick wall – get the foundation right and stands forever. Muck it up and it'll fall down.
There are a few brokers who have already replied to this thread – I would suggest you contact one of them.
smartcube wrote:I want to have some help/suggestions as to how do i setup my loan account to suit the best outcome for me. plan is to buy a another ip/own house in next 2~3 months time.iam on high tax bracket.
Given the purchase of a PPOR is likely make sure you set your loans up properly from day one. Really important you have a good broker in your team.
smartcube wrote:- Which banks offer the best.
- should i go for fixed or variable ? why?
- how much should i pay initially is it 5% or 10%? which works best?
- is LMI(mortgage insurance)tax detectable?
- how should i structure the loan so it fits current and future purpose(buying own/IPs)?
Leave those ones for the brokers.
smartcube wrote:- once the settlement happens what all can i start claiming in for tax?
As soon as the property is available for rent. For a list of deductible items check out the ATO website documents here
smartcube wrote:- house is 20 years old so how to go about depreciation?
Contact a Quantity Surveyor. Depreciator, Deppro, BMT & Washington Brown all come to mind. They will inspect your property at identify all of the depreciable items in the property including the depreciable value of the building itself.
When you receive it give a copy of your report to your accountant and he/she will be able to use it to prepare your tax return.
smartcube wrote:- is buying a new house better or old house?
New v old. There is no straight answer – each individual has slightly different perspectives on this question. Given your property is 20 yrs old it will have reduced depreciation remaining. The key is whether or not it performs as you planned.
smartcube wrote:- if iam fixing some basic stuff in the house before renting it out is that cost tax claimable?
Probably note as the items needing repair were there when you purchased. You may be able to defer some of the repairs until a tenant is in place in which case they may be claimable. Suggest you carefully read the document I linked to above. This will help clarify the repairs V upgrades issue for you.
smartcube wrote:- any excel sheets to keep track of spending/income from the IP?
Send me an email to [email protected] – I have one which is very simple but easy to use. I now have a book-keeper and she uses MYOB. But you are welcome to the spreadsheet.
smartcube wrote:- anything else that i need to be aware off?
I suspect there is so much more for you to be aware of. I must admit I am the type of person who needs to have a pretty good grasp on what I am doing before I make a move. It seems you are not – I would strongly recommend you spend a fair bit of time getting up to speed on some of the basics.
PS – Why Point Cook?
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