I'm moving interstate for work in a hurry and we're moving out of our PPOR and will rent out it out:
- Home Loan (P&I) is approximately $525K, current balance $375K
- Current Valuation of property is approximately $750K
- Both me and my wife are PAYG wage earners
A friend has recommend that I look to convert home loan to interest only investment loan for up to 90% of value of property. (Surplus funds to be held for flexibility ie. further investment purposes later or fund new PPOR). He said all interest is tax deductible.
Is this the best course of action if I am converting the PPOR to an IP? My concern is that I have paid off $150k off the principal and my understanding is that portion of the principal is no longer deductible.
Thanks for your help!
- Home Loan (P&I) is approximately $525K, current balance $375K
- Current Valuation of property is approximately $750K
- Both me and my wife are PAYG wage earners
A friend has recommend that I look to convert home loan to interest only investment loan for up to 90% of value of property. (Surplus funds to be held for flexibility ie. further investment purposes later or fund new PPOR). He said all interest is tax deductible.
Is this the best course of action if I am converting the PPOR to an IP? My concern is that I have paid off $150k off the principal and my understanding is that portion of the principal is no longer deductible.
Thanks for your help!