Releasing equity

[Nem]

I need your advice here please, not sure if I'm understanding correctly about equity release...

I have equity available in my current PPOR which I am planning to upsize in 2 years time

I understand I better stop paying principal amount and change loan to Interest Only as this PPOR will become IP one day.
We are also thinking of renovating this PPOR while living in it (DIY reno) and from what I understood, we shouldnt use our own money for it so was thinking to increase loan.
We would also like to purchase IP asap.

We have 80K cash from bad investment sale.

The question is now, should I:

1. Use 80K cash as a deposit for IP
2. Take money for deposit from my current PPOR
3. Use equity in current PPOR as deposit for new IP??

What would be the best option to buy IP, convert current PPOR to IP one day and to use as much cash as possible when buying new PPOR to have as less bad debt as possible

Thank you

 

[Terry_w]

No, don't use cash, borrow to reno.

set up a new split for the deposit and costs on the new PPOR - this won't be deductible.

 

[Nem]

No, don't use cash, borrow to reno.

set up a new split for the deposit and costs on the new PPOR - this won't be deductible.

Thanks Terry, as I thought

How do I fund my IP purchase?

 

[Terry_w]

Thanks Terry, as I thought

How do I fund my IP purchase?

Same way, separate split secured by property A. use for deposit on property B with the major loan secured by property B. IO.