Hi, long time lurker 1st time poster.
I've read some threads regarding PPOR to IP (thanks TerryW, Rolf and others for some great info)as my wife and I are considering this soon. Some info on our current situation and what I'm looking to do.
We currently own our home in Ringwood and dont have any debt against the property, the house would be valued at around $500K. We have an interest only loan with a limit of $150K, around $58K had been drawn down on this for investments, value of investments approx $100K, we have $58K sitting in an offset account. Our home is security for the loan.
I have found another home that we are looking to purchase in Warrandyte, purchase price approx $850K, I'm estimating $50K costs so $900K needed. We would purchase this home in my wifes name.
I'm not wanting to sell Ringwood at present so am thinking of purchasing my wifes share of the property for $250K with IO loan and placing the funds in an offset account until needed for our new PPOR purchase. We would then have a deductible loan on Ringwood for $250K and a non deductible loan on Warrandyte for $600K (the $50K costs will be paid with cash).A few questions with this.
1) Is the process for spousal transfer as simple as deciding the value by obtaining some recent sales data of comparable houses in the local area, then complete a form from the titles office and have the bank organise the finance? If anybody who has been down this path or is familiar with the steps could provide me with some guidance it would be much appreciated.
2) I've been reading the info on the ATO website and I might be mistaken but I understand that I can claim Ringwood as my PPOR while I'm not living in it for 10 years and of these years it can be income generating for up to 6 years. I found the info a little confusing so hopefully someone can help me here. I was also wondering about the process of 'claiming' a place as your PPOR. Is this something that is done on your tax return when you have sold the house or is there something I need to do now?
For the $150K investment loan, I would like to change that to LOC with $100K limit. Any advice from Brokers would be great here, my Ringwood property is currently being offered as security. Will any banks let me offer the shares and managed funds as security?
Cheers
I've read some threads regarding PPOR to IP (thanks TerryW, Rolf and others for some great info)as my wife and I are considering this soon. Some info on our current situation and what I'm looking to do.
We currently own our home in Ringwood and dont have any debt against the property, the house would be valued at around $500K. We have an interest only loan with a limit of $150K, around $58K had been drawn down on this for investments, value of investments approx $100K, we have $58K sitting in an offset account. Our home is security for the loan.
I have found another home that we are looking to purchase in Warrandyte, purchase price approx $850K, I'm estimating $50K costs so $900K needed. We would purchase this home in my wifes name.
I'm not wanting to sell Ringwood at present so am thinking of purchasing my wifes share of the property for $250K with IO loan and placing the funds in an offset account until needed for our new PPOR purchase. We would then have a deductible loan on Ringwood for $250K and a non deductible loan on Warrandyte for $600K (the $50K costs will be paid with cash).A few questions with this.
1) Is the process for spousal transfer as simple as deciding the value by obtaining some recent sales data of comparable houses in the local area, then complete a form from the titles office and have the bank organise the finance? If anybody who has been down this path or is familiar with the steps could provide me with some guidance it would be much appreciated.
2) I've been reading the info on the ATO website and I might be mistaken but I understand that I can claim Ringwood as my PPOR while I'm not living in it for 10 years and of these years it can be income generating for up to 6 years. I found the info a little confusing so hopefully someone can help me here. I was also wondering about the process of 'claiming' a place as your PPOR. Is this something that is done on your tax return when you have sold the house or is there something I need to do now?
For the $150K investment loan, I would like to change that to LOC with $100K limit. Any advice from Brokers would be great here, my Ringwood property is currently being offered as security. Will any banks let me offer the shares and managed funds as security?
Cheers