Hi folks,
Assuming you were drawing down equity from IP #1 to fund the deposit for another IP #2, do you take the opportunity when refinancing IP #1 to go back out to 30 years, thus reducing your repayments and freeing up cashflow?
What are the risks involved here? I suppose if you keep extending back out to 30 years every time you drew down equity, the loan might never get re-paid but if there is good capital growth then would that matter, especially since with the extra cashflow you can buy more and more IPs?
Which then begs the question, assuming instead you have an IO loan, since you never pay anything off (if you keep extending the 5 year IO period again and again), then it should be possible to make "repayments" into a 100% off-set account effectively behaving the same way as a P&I repayment, except that you can get accesss to the funds at anytime for future investing? Am I correct?
Thanks so much!
Thanks
Assuming you were drawing down equity from IP #1 to fund the deposit for another IP #2, do you take the opportunity when refinancing IP #1 to go back out to 30 years, thus reducing your repayments and freeing up cashflow?
What are the risks involved here? I suppose if you keep extending back out to 30 years every time you drew down equity, the loan might never get re-paid but if there is good capital growth then would that matter, especially since with the extra cashflow you can buy more and more IPs?
Which then begs the question, assuming instead you have an IO loan, since you never pay anything off (if you keep extending the 5 year IO period again and again), then it should be possible to make "repayments" into a 100% off-set account effectively behaving the same way as a P&I repayment, except that you can get accesss to the funds at anytime for future investing? Am I correct?
Thanks so much!
Thanks