Simplest way of organising repayments of loans / expenses and Rental income?

[pipsal]

How do most of you organise your IP loans with regards to income/expenses, etc? Do you tend to separate properties/loans, or just pool all income/expenses and keep an eye on things via spreadsheets, etc?

At the moment I have all rent going directly into an offset account that doesn't get touched, and I pay all expenses including the mortgage out of my everyday account. I was thinking that when I get IP2 I would keep the one offset account (as IP1 will be PPOR one day) and get all rent put into that account as well, but I don't think that payments can be set up to come out of a MISA account to pay new mortgage and income won't completely cover both, so I'll have to have Rent for one property at least going into the everyday account. Is there a better way of doing this - what about for more than 2 properties, and if loans are with a variety of lenders?

 

[Paul@PFI]

For clients with a PPOR with a loan (non-deductible) I generally recommend the offset is against this loan.

 

[baby blue eyes]

Sounds like you are with CBA

They now have unlimited transactional offsets. Forgive me if you know this already, but if you don't then set them up.

We set my son up with three. One for investment, one for emergency funds and one for the loan repayments. He has another everyday account with another bank so he does not touch his cba offsets.

With me I have an offset against each loan I have. Some have no funds in them and are clean if I am forced to redraw loan funds where I can't pay directly from loans eg equity used as a deposit for another prop.

Most of my props rent goes to their own offset and loan repayments and expenses are paid from there. My props are cf positive and I have no non deductible debt.

 

[Terry_w]

How do most of you organise your IP loans with regards to income/expenses, etc? Do you tend to separate properties/loans, or just pool all income/expenses and keep an eye on things via spreadsheets, etc?

At the moment I have all rent going directly into an offset account that doesn't get touched, and I pay all expenses including the mortgage out of my everyday account. I was thinking that when I get IP2 I would keep the one offset account (as IP1 will be PPOR one day) and get all rent put into that account as well, but I don't think that payments can be set up to come out of a MISA account to pay new mortgage and income won't completely cover both, so I'll have to have Rent for one property at least going into the everyday account. Is there a better way of doing this - what about for more than 2 properties, and if loans are with a variety of lenders?

You are losing money doing it this way. I too would suggest all into a 100% offset account. Even if you have paid off non deductible debt this will still help you save interest.