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This is the point I was trying to make. Looks like Rixter is using CB to prove servicability to banks (don't know if he actually using the CB to service loans), whereas in my example , I was physically using the cashbond (over a 5 year period) to service loans, in which case after 5 years...

Yep. Was looking at it from the point of view in number 2 above, i.e to fund the loan on new purchase. Regards Marty

Hi Rixter. You are obviously very knowledgable on the subject of cashbonds and I am not (i.e have never used them), but the way they were explained to me was that after the 5 year period (in the example of $100K over 5 years), you have exhausted your LOC i.e drawn down the $100K, to service...

Hey RJ Probably stating the obvious here, but anyway..........don't forget that if you borrow from a LOC (or anywhere else) to purchase a cashbond, say $100K over 5 years, that after the 5 years is up, you have spent the $100K but still have the loan for it which still needs to be serviced...