Hi guys.
About a year ago I purchased a property (my first) using the FHOG. The property was rented out (under an existing lease before I purchased) until just under 6 months from the date of settlement, at which point I moved in.
I always intended to use the property as an IP and to just move in to comply with my FHOG and stamp duty obligations.
The loan is for PI, which I understand now was a mistake from reading other posts on this forum for a number of reasons.
Therein lies my question - obviously I cannot claim interest on the loan during the time I have occupied the property and it is not rented out. However, I don't understand why I can only claim interest when the property is rented out if it is IO rather than as PI. I have read a few posts on this forum where people say that if you intend to change the property from PPOR to an IP then you must have an IO loan to claim the interest.
Can someone please explain?
About a year ago I purchased a property (my first) using the FHOG. The property was rented out (under an existing lease before I purchased) until just under 6 months from the date of settlement, at which point I moved in.
I always intended to use the property as an IP and to just move in to comply with my FHOG and stamp duty obligations.
The loan is for PI, which I understand now was a mistake from reading other posts on this forum for a number of reasons.
Therein lies my question - obviously I cannot claim interest on the loan during the time I have occupied the property and it is not rented out. However, I don't understand why I can only claim interest when the property is rented out if it is IO rather than as PI. I have read a few posts on this forum where people say that if you intend to change the property from PPOR to an IP then you must have an IO loan to claim the interest.
Can someone please explain?