Hi there
We are seeking to purchase our 2nd IP and to do this without paying LMI and to have the new IP stand on its own, our banker suggests we use the available equity in our PPOR (only up to 80%) which equates to $55k and convert this amount into an investment loan of which this would then be used as a deposit for our IP. Hence, avoiding LMI.
My two questions are 1) is this investment loan a tax deduction? and 2) does this sound like a good strategy?
I would appreciate any thoughts as we are getting confused by all the possible ways in which to set up loans once you start investing.....
thanks
We are seeking to purchase our 2nd IP and to do this without paying LMI and to have the new IP stand on its own, our banker suggests we use the available equity in our PPOR (only up to 80%) which equates to $55k and convert this amount into an investment loan of which this would then be used as a deposit for our IP. Hence, avoiding LMI.
My two questions are 1) is this investment loan a tax deduction? and 2) does this sound like a good strategy?
I would appreciate any thoughts as we are getting confused by all the possible ways in which to set up loans once you start investing.....
thanks