Hi,
I am just seeking some advice in regards to loan structuring / finance.
I am at the beginning of the Investment journey, I have previously owned an IP in regional NSW but sold it because it was underperforming.
Currently, my wife and I have a 2 bed, 1 bath, 1 garage villa which is our PPOR. A recent ANZ valuation has it at $630 k , the mortgage is $430 k. So there is currently about $74 of useable equity here (based on only being able tu use 80% LVR). The long-term investment journey for us is important however, at this point in life more importantly is finding a new PPOR where we can raise our young family. Then in the short to medium term hopefully additional equity is raised and we purchase additional IP's.
My question is what is the best way to structure our fincance moving forward. We want to purchase a new PPOR for approximately $750 k, as mentioned above we have $74 k in useable equity and about $40 k saved in our offset account for a deposit. Once we purchase a new PPOR we will turn our current PPOR into IP1 with an interest only loan, I have done the sums and this should be close to cash flow neutral.
Purchase price: $750 k (inclusive of purchase costs)
Deposit: $114k (includes equity and savings)
LMI: Approx 85% - I am willing to accept paying LMI as there is potential for CG in the area, and doesn't LMI start increasing dramatically beyond about 87%
What is the best way to use the equity, is it as a lump sum or line of credit? I know cross-collaterisation is another option but I have read too many negative stories about that option. And, do any banks allow you to have two separate mortgages that are not cross-collaterised or is it best to use two different lenders?
I am just seeking some advice in regards to loan structuring / finance.
I am at the beginning of the Investment journey, I have previously owned an IP in regional NSW but sold it because it was underperforming.
Currently, my wife and I have a 2 bed, 1 bath, 1 garage villa which is our PPOR. A recent ANZ valuation has it at $630 k , the mortgage is $430 k. So there is currently about $74 of useable equity here (based on only being able tu use 80% LVR). The long-term investment journey for us is important however, at this point in life more importantly is finding a new PPOR where we can raise our young family. Then in the short to medium term hopefully additional equity is raised and we purchase additional IP's.
My question is what is the best way to structure our fincance moving forward. We want to purchase a new PPOR for approximately $750 k, as mentioned above we have $74 k in useable equity and about $40 k saved in our offset account for a deposit. Once we purchase a new PPOR we will turn our current PPOR into IP1 with an interest only loan, I have done the sums and this should be close to cash flow neutral.
Purchase price: $750 k (inclusive of purchase costs)
Deposit: $114k (includes equity and savings)
LMI: Approx 85% - I am willing to accept paying LMI as there is potential for CG in the area, and doesn't LMI start increasing dramatically beyond about 87%
What is the best way to use the equity, is it as a lump sum or line of credit? I know cross-collaterisation is another option but I have read too many negative stories about that option. And, do any banks allow you to have two separate mortgages that are not cross-collaterised or is it best to use two different lenders?