Anyone else following this kind of thinking? I kind of hope so, hate to be the only one.
Your not the only one!
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Anyone else following this kind of thinking? I kind of hope so, hate to be the only one.
Your not the only one!
Ok, Line of Equity, that makes sense thanks, damn online glossary's I found have no mention of it. Yes I understand about using the equity with new valuations and the capitial growth which is where it comes from. I've just learnt all that lately, well how it all comes together.LOE = Line of Equity.
you use the equity to fund future purchases - akin to an LOC (Line of Credit) but it a predetermined amount based on the valuation - at time of application - of your portfolio (or IP depending if X-col).
it's using CG to fund future acquisition, without the rigmorol of re-financing every time.
That's a great point.Cash is King people. Put the money in an offset, then it's always yours if you want it. Put it on the loan, you can only redraw it for investment...
So that means for tax purpses you are not losing out either which is good.Cash in an offset means you pay no interest on it's equal in a loan, yet you can always spend it and the debt stays deductible...
You both are not the only one!
Yes, if you still have PPOR debt, and your IPs are held in your personal name, then you'd always put excess funds into the offset attached to this loan. It's once you've got excess funds again - ie more than $200K cash to offset your $200K PPOR loan - that you need an offset against your IP loans.I don't see any advantage for my getting the next IP loan with an offset account given that the PPoR is what I wish to pay down fast as well.
Would this be the most correct thinking?
Oh, yes, I forgot to say - I agree with joanmc regarding what LOE stands for.LOE as I used it in this thread means Living off Equity - a strategy using borrowed funds against your houses to live off.
No I don't think you're daft.this to me makes me feel better
No I don't think you're daft.
The point you made above re feeling better is an important one, IMHO, regardless of what structure anyone tells you that you should be using.
Regards
Marty
Cash in an offset means you pay no interest on it's equal in a loan, yet you can always spend it and the debt stays deductible...
I don't think it's daft, but I do think it's wise to thoroughly understand the choice that you're making, and the reasons for it.I would be interested if someome can tell me if I am absolutley daft or not....