I've done some searches and can't seem to find my exact answer on this one...
If we extend our PPOR loan to 90% to access some equity (so paying LMI for the privledge) to have in an account ready to use to purchase an IP, is the LMI tax deductable over 5 years as a borrowing cost? The money from this
2nd mortgage would purely be used in the purchase of the IP (no private use at all) and would at all times be kept seperate from the PPOR loan. The reason for doing this would be to save paying LMI at the 'other end' ie. on the IP loan and we get a fairly good interest rate by using our current lender.
So it's all good unless the LMI on this portion is not tax deductable, in which case we wouldn't bother going over 80% on the PPOR loan and pay LMI on the new IP loan if it was to work out cheaper.
Yes I understand it takes us to a higher LVR than what a lot of investors here consider to be comfortable, but thats the just the position we are in at the moment.
Thanks for any help in advance.
If we extend our PPOR loan to 90% to access some equity (so paying LMI for the privledge) to have in an account ready to use to purchase an IP, is the LMI tax deductable over 5 years as a borrowing cost? The money from this
2nd mortgage would purely be used in the purchase of the IP (no private use at all) and would at all times be kept seperate from the PPOR loan. The reason for doing this would be to save paying LMI at the 'other end' ie. on the IP loan and we get a fairly good interest rate by using our current lender.
So it's all good unless the LMI on this portion is not tax deductable, in which case we wouldn't bother going over 80% on the PPOR loan and pay LMI on the new IP loan if it was to work out cheaper.
Yes I understand it takes us to a higher LVR than what a lot of investors here consider to be comfortable, but thats the just the position we are in at the moment.
Thanks for any help in advance.