One for the numbers people please. I am looking at purchasing a small commercial and lender is suggesting a portfolio loan. I will use an unencumbered commercial as security to borrow the max. I would like to fix the loan (max 5years allowed int only, no additional payments) but my plan is to run it so all rents will pay down the loan within 10 years. I am trying to find out what % I should fix so I can still pay down the max but not disadvantage myself with the time I have locked in the fixed portion. My rough scrathings lead me to think about 50 - 60% of the loan fixed for 5 years the rest variable and by the time the 5 years is up I would have paid down 40%. These are the numbers
Prop A - purchase price $500k
Rent - $37500 net pa
Rent review - CPI
Prop B - value $430k
Rent - $29900 net pa, rent going to $33000 Mar 2010 then CPI
Loan Term 10 years
Variable int rate - 6.04%
Fixed int rate - 7.44% for 5 years
Any help or direction would be greatly appreciated, cheers.
Prop A - purchase price $500k
Rent - $37500 net pa
Rent review - CPI
Prop B - value $430k
Rent - $29900 net pa, rent going to $33000 Mar 2010 then CPI
Loan Term 10 years
Variable int rate - 6.04%
Fixed int rate - 7.44% for 5 years
Any help or direction would be greatly appreciated, cheers.
