Abreviations

[jackstar]

Is there somewhere I can find that explains all of the abreviations ie. lo doc loans, cfc etc

 

[geoffw]

Try this one

 

[jackstar]

thanks just what IWas after

 

[Toni]

Can someone please tell me what LOE stands for.

Toni

 

[Harris]

Can someone please tell me what LOE stands for.

Toni

Living Off Equity - Drawing income from the equity available in IP or PPOR. The income drawn is basically a loan (no tax paid on a loan) and refinanced for an extended term - say 25/ 30 years.

 

[Toni]

Living Off Equity - Drawing income from the equity available in IP or PPOR. The income drawn is basically a loan (no tax paid on a loan) and refinanced for an extended term - say 25/ 30 years.

Thanks Harris for your reply.

Harris I am obviously quite vague when it comes to these things as I have only ever invested according to very basic principals, i.e. Loan from bank, security on own house and then negative gear for the pupose of reducing taxable income and gaining an asset or two at the end of the 5 - 7 year investment cycle.

I don't understand the reasoning behind living off equity of an investment loan as, I assume, you would then be paying non tax deductable interest on the re-financed portion. The only rationale that I can come up with in my very simple mind would be to avoid paying capital grains tax, but this would be payable eventually.

And I could be wrong again, the way I have or are doing it is a follows;

I will fully own my own home this year. By the end of this year or if need be longer, (when one of my investment prop's = $500), I will sell off one home to pay for the other, and then allow the income from the two remaining properties to pay off the 2nd Inv prop. I then have no out of pocket expenses and can look to investing in another area.

Is this far too simple. Should I be looking at different strategies?

Toni

 

[Harris]

Toni,
Try doing a search on the forum. There has been a plethora of threads on LOE. There were a few from Steve Navra who explained it quite well. Search for LOE and Navra - you are bound to be inundated with a lot of reading material on the topic .

Harris

 

[Toni]

Thanks Harris