Prepay interest on IP loan

[virgo]

Hiya

I know it is only 5 days away from June year end so don't scold me okay?

So hubby has a huge capital gain this financial year from some shares sale...

And we are thinking of prepaying loan interest on one IP (ie 1 year in advance)

Questions:

a) if the IP loan is already fixed at say 5%...can i do that?

b) Do i just prepay interest at 5%? Or will bank slug me with a higher interest rate?

c) i have surplus funds in my offset account; do i just ask the bank to transfer the funds ?

d) if you are still on the same tax rate before and after doing this strategy, is there any point doing it?

Thanks!

 

[Aaron_C]

First question is which bank? Usually it requires a product change which can take longer than 5 days.

 

[virgo]

prepay interest

Ah....it is Westpac ...is that cause for alarm and panic?

 

[virgo]

prepay interest

Wesucks did say they will expedite it though....

 

[Peter_Tersteeg]

Wesucks did say they will expedite it though....

That's what they told me in February and 5 phone calls later about me switching to a fixed rate. At this point I think I'll move my business elsewhere instead.

 

[wylie]

Ah....it is Westpac ...is that cause for alarm and panic?

One word... YES!

If you can do it, then get onto it today. Each year Westpac stuffs our interest in advance, even when we've done all the paperwork, signed and returned at the start of June. I don't like your chances, but you might as well give it a try.

You can also prepay rates, water, insurance, land tax (OSR will say it cannot be done, but I've done it - just push it).