W
WebBoard
Guest
From: Bill Trainor
Hi everyone
For a long time I have been a huge fan of Jan's work. Five years ago I bought IP 1 with IO fixed for 5 yrs at 7.95%. Over this period I have paid more than I would have on variable however as Jan says 'you can still afford to smile'.
I am now purchasing another two properties, using LOC as 10% deposit & costs (inc LMI) & have been advised I can get a professional package rate of 6.07% via ANZ, or at IO fixed rate for 5 years, 7.35%. Both properties are cash positive, and the difference in the rate variance on about $460k loan is around $50 per week forgone in the pocket (call it 'opportunity cost').
I have also just read Margaret Lomas' book "How to create an income for life'. Margaret is a fin planner focusing on cash positive IP. She speaks harshly of fixing rates as it restricts cash flow. Jan says fix 2/3 of your portfolio to protect cashflow. My gut says to go this way as I am concerned having best part of $1m on variable rate. Not sure if my concern is valid but that is what the tummy is telling me!!
I would really appreciate anyone's advise on this area, as I need to finalise all of these loans next week!
Thanks in advance
Cheers
Bill
Hi everyone
For a long time I have been a huge fan of Jan's work. Five years ago I bought IP 1 with IO fixed for 5 yrs at 7.95%. Over this period I have paid more than I would have on variable however as Jan says 'you can still afford to smile'.
I am now purchasing another two properties, using LOC as 10% deposit & costs (inc LMI) & have been advised I can get a professional package rate of 6.07% via ANZ, or at IO fixed rate for 5 years, 7.35%. Both properties are cash positive, and the difference in the rate variance on about $460k loan is around $50 per week forgone in the pocket (call it 'opportunity cost').
I have also just read Margaret Lomas' book "How to create an income for life'. Margaret is a fin planner focusing on cash positive IP. She speaks harshly of fixing rates as it restricts cash flow. Jan says fix 2/3 of your portfolio to protect cashflow. My gut says to go this way as I am concerned having best part of $1m on variable rate. Not sure if my concern is valid but that is what the tummy is telling me!!
I would really appreciate anyone's advise on this area, as I need to finalise all of these loans next week!
Thanks in advance
Cheers
Bill
Last edited by a moderator: