1. If I have a property (A) with a loan / mortgage with the ANZ.
2. My mortgage broker is using the equity in the property (A) to get a new loan from NAB to buy a new property (B).
Q. I assume this is all ok? …..leading to
Q. As its just the equity in the property (A) that I’m using for new loan (B) is that why ANZ are ok with this and its all legal?
1. Yes – it’s fine.
2. Why would it be illegal? It’s your equity – you don’t have to use ANZ to fund the next purchase. You can use whichever bank you like.
Some banks don’t like 2nd mortgages. It’ll be that you are taking a line of credit out with anz and then use that money to find the deposit, with the remaining finance coming from NAB.
CBA are one of the banks that will go 2nd in line on a mortgage. Most banks policy is to be 1st and 1st only.
This reply was modified 9 years, 10 months ago by wilko1.
Careful..the banks are tying up one property with the other by doing this. My accountant recommends against it for various reasons. Get professional advice. JA10
I’d think this wouldn’t be a second mortgage guarantee situation, but an equity access followed up with purchase finance with NAB secured solely to the new purchase. This is standard fare and nothing to be concerned about.
I’d think this wouldn’t be a second mortgage guarantee situation, but an equity access followed up with purchase finance with NAB secured solely to the new purchase. This is standard fare and nothing to be concerned about.
Yep – that’s how I’ve read it too….and the basis for my response. Quite a normal structure.
I often wonder how the loans work on this. I have yet to do it.
House A. $500,000 value $250,000 owed. $250,000 equity. I reuse $100,000 for property B deposit.
House B. $500,000 value $400,000 owed.
Am I paying interest in that $100,000 equity that I assume is a line of credit or similar? If so what’s my total net worth? Is it still $250,000 equity just split $150,000 and $100,000 now?
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