We r getting mortgage for $400k for our first IP. Our broker’s original plan was to use 100k equity loan for our PPOR and get 300k investment loan. However, due to our tight income, he told us the structure is going to $200k equity loan with $200k investment loan. We have quite many equity but we are worried that if we use too much equity this time, we may have trouble to build up our profolio later.
By doing $200k & $200k, our new investment LVR will be 55%. Is that good for tax deduction purpose?
Please help and thanks very much for your time!
Which lender is the new purchase? That’s really poor planning, the broker should know your capacity in advance for issues like this.
You may very well be at your maximum, or all the options haven’t been explored.
Corey Batt | Precision Funding
http://www.precisionfunding.com.au
Email Me | Phone MeInvestment Focused Finance Strategist - servicing Australia-wide
Thanks Corey for your reply!
It is CBA as I am only on casual position for three months.
I feel a bit the same, there may be other options, but as first time investor, it is really hard to tell.
May I ask why this is very poor planning?
May I ask why this is very poor planning?
Because they should have done more precise calculations of your borrowing capacity upfront.
All of it would be deductible though given that both loans are being used for IP purposes….the biggest downside of course is that you’ll be using up a large chunk of equity so you may not be able to purchase again.
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]
Thanks very much, Jamie.
What are the main facts that can influence bank to decide that more equity loan has to be used and less investment loan can be lent? Income?
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