Structuring my loans

[veech23]

Hi All, first time poster, please go easy if these are NOOB questions
I have a PPOR and brought IP1.
PPOR loan1 70K in joint names of me/wife
PPOR loan2 140k in joint names of me/wife

Currently valuation of PPOR came at 500K with equity of 260k.

IP1 costs 400K, planning to borrow 80% from the bank with rest of 20% + costs to be funded from my equity.

I am thinking of getting two equity loans of 100K, 90K (400k - 140k - 70k) with their own offset accounts and use the 100K to fund the 20% + costs of IP1. Does this sound OK or shall i do away with offset for these equity accounts and redraw to fund the expenses of 20%+ costs

As equity loan is in joint names, and I am the sole earner, how to structure loan so i can claim her part of interest which is used to by IP1.

Lots of questions i know, thanks for looking.

VG

 

[Terry_w]

Who owns the PPOR?

Who will own the investment property?

 

[Jamie M]

HI VG

Welcome aboard - always good to see a fellow Canberran on board.

What are your longer term plans with property investing? Are you looking to purchase multiple properties or stop at the one?

With this one purchase in mind - the general structure is to release enough equity against your PPOR to fund the 20% deposit and costs (so around $100k). This loan should be set up as a separate loan account.

You'd then set up another $320k loan against the IP.

I wouldn't bother with multiple offsets - just have one linked up to your non deductible PPOR loan.

Keep your IP loans interest only.

Cheers

Jamie

 

[veech23]

Hi Terry,
Me/Wife own the PPOR, both our names are on the loan.

I am planning to put IP1 on my name only for tax purposes.

Hi Jamie, Thank you for the reply, should change the location as I moved to melbourne. Good memories of the canberra though.

I am thinking of buying IP2 in next year and rest for a while until enough equity builds up and bank willing to lend more.

 

[Rolf Latham]

As equity loan is in joint names, and I am the sole earner, how to structure loan so i can claim her part of interest which is used to by IP1.

Generally, but not always, deductability will flow to the owner of the asset purchased with the equity loan.

But pls seek specific tax advice

ta
rolf