Hi finance expert,
I am in the situation where my LOC funding negatively geared IP expenses (excluding interest portion) is
nearly maxed out and I’d like some opinion on what is the best option (financial wise) going forward:1. Pay off or reduce LOC balance with own cash for which interest is not deductible. So I am going to
take a big hit for interest on my own PPOR loan as the cash will come out of offset account.
2. Increase LOC limit. I haven’t done this as I am unsure about my DSR. I am just concerned it may
backfire with the bank instructs to reduce the LOC balance due to lending/credit tightening of late.
3. Change the LOC to a different loan product with lower interest but with a fix term only.Thanks,
FXDHi FXD,
I deliberately didn’t respond to this when first posted, as I have nowhere near enough knowledge, nor enough information from you, to make any kind of valid suggestion.What I WOULD suggest is that you put this question to a Mortgage Broker or similar Financial Adviser who can look in depth at your situation, then discuss what would be the best path for you.
Maybe one of our forum MB’s might take it upon themselves to pop in to offer some ideas…..
Benny
NO worry Benny and thanks for your suggestion indeed.
Convert the existing LOC into a term loan and set up a new LOC. If you are worrried – do them in separate applications, with the new LOC after the approval of the conversion.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
You must be logged in to reply to this topic. If you don't have an account, you can register here.
