Hi Everyone,
We currently owe $252K. House has been valued at $540K, so we are tapping equity and bank is topping up loan to $432K so we can use difference to put towards 20% ++ for new PPOR to avoid LMI on the new place. We currently have surplus of $35K which we will redraw to use as 5% deposit on new place if we place at auction.
We then want to use old PPOR as IP.
Is this the best way to restructure our loans? What part of the loan will be deductible (just the interest on the 252K right? - but then we will be repaying both P+I on the whole $432K)? Loan is currently on BW Loantracker so is good interest rate. I don't know if we can change it to IO without refinancing to IO, and if we do that and maybe access the equity through a LOC with higher rates whether that plus all the application fees outweigh the good interest rate.
Thank you!
Confused.
We currently owe $252K. House has been valued at $540K, so we are tapping equity and bank is topping up loan to $432K so we can use difference to put towards 20% ++ for new PPOR to avoid LMI on the new place. We currently have surplus of $35K which we will redraw to use as 5% deposit on new place if we place at auction.
We then want to use old PPOR as IP.
Is this the best way to restructure our loans? What part of the loan will be deductible (just the interest on the 252K right? - but then we will be repaying both P+I on the whole $432K)? Loan is currently on BW Loantracker so is good interest rate. I don't know if we can change it to IO without refinancing to IO, and if we do that and maybe access the equity through a LOC with higher rates whether that plus all the application fees outweigh the good interest rate.
Thank you!
Confused.