Need advice on finance

[Hobbit]

Hi all,

Im new to here so hello to everyone!

Im not new to IP though.

I have an IP which I bought back in 2008 and also have more than 40 K in my offset account. Currently owe 285 K on my investment loan which is interest only.

I want to buy a second car for around 35 K this year and was wondering what is the best way to do it. I have 20 K cash sitting around and a tad over 40 K in offset account in my IP loan. How would you buy the 35 K car, using offset, save, or refinance IP loan?

Any advice would be great!

Thank you

 

[Shahin_Afarin]

For me cash is king so I tend to borrow where I can instead of using cash.

If there is enough equity in the property then you can create a separate account do the cash out and purchase it that way. The pro of doing this is that you are paying a home loan rate for the car vs car loan rates. The con is that you are tapping in the equity of your property which may restrict you from growing the portfolio.

So for me the ? is do you do it via car finance or home loan finance?

 

[Aaron_C]

Yes if the car is for business use then a car loan may be more suitable - otherwise a simple loan increase on your existing home loan may be the cheapest way.

 

[Hobbit]

Cheers all!

Will refinance and get about 50 K out and put the rest into offset account.

 

[Shahin_Afarin]

create 2 splits (if lender permits).