ADICE needed - Selling PPOR but used as security for 2x other property

Discussion in 'The Buying & Selling Process' started by WestOz93, 12th Jan, 2019.

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  1. WestOz93

    WestOz93 New Member

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    A family member of mine is selling their PPOR but has used the equity in the property to buy an investment property and the new PPOR.

    The advice they are after is how does it work releasing the old PPOR as security for the other two properties and transferring investment security to the new PPOR?
     
  2. Trainee

    Trainee Well-Known Member

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    What do you mean used the equity? Did they cross the loan, or just borrowed more against the ppor for the deposit?
     
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  3. WestOz93

    WestOz93 New Member

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  4. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    They will need to discharge the mortgage(s) on the property that will be sold. That will mean either
    a) use the proceeds to pay out the loans associated with the mortgage, or
    b) pay out some of the loan and substitute security for the loans that relate to use for properties that are not being sold.

    See

    Tax Tip 74: Selling a property that secures other loans Tax Tip 74: Selling a property that secures other loans
     

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