Is there tax issues if you get rent paid into offset and then transfer it to bank the investment loan is with? Or is it more simple to just get rent paid straight into loan the bank is with and then transfer the shortfall?
We always had rent paid into an offset account. Then an automatic transfer each month from the offset for the mortgage payment(s).
Rent is cash so it should ideally go into the offset account attached to the non-deductible debt and the investment loan paid from this. Doing otherwise will cost you
If rent is paid directly into the loan and you also have a direct debit coming out you will pay your mortgage twice as well.
I always try to simplify my life. Cost can be money, or time. The monthly loan repayment is a fixed amount, the rental received each month can vary. By paying all rent into the offset, I could schedule the monthly mortgage repayment(s) to occur automatically. If you paid the rent directly into the mortgage, EVERY month you would have to calculate how much to pay to make up the required payment, then manually do the transfer. Too much unnecessary work for me!
Did you get the money pulled from offset by the bank or did you set up a automatic transfer? The goal is to try keep it in the offset the longest.
Not sure what you mean by your reference to “money get pulled from the offset by the bank”??? We set up the automatic direct payments each month from the offset to the mortgage(s). The bank did the transfer, same as with any regular direct debit payment.
They always ask. Its illegal for a lender to insist on a specific payment basis. You can cancel any direct debit. Provided you pay on time by another manner its not a issue. Bpay, EFT etc Paying early can assist reduce interest. Banks dont want that do they !!
so if rent goes in offset mid month and end of month but you pay weekly repayments to bank how would you do it to keep it in offset as long as possible?
Its probably of no difference since the offset accounts ensures interest is minimised ona daily basis.
Loads of lenders will do this if you are paid weekly. But you can pay it by EFT weekly too. If paid monthly on the due date and the $$$ are kept in the offset I see no difference whether its repaid early or in the offset. The issue for people is if they leave the $$$ in savings and pay it monthly then the loan takes longer to repay. The daily benefit of the offset is akin to a real repayment even when it isnt.
Dont understand why you want to make it so confusing. Rent to the offset. Payments directly debited from the offset. When you have multiple properties, its just not efficient to do it any other way.