Hi gang, I have a PPOR owner occupied loan of 200k with 200k cash funds available for redraw (effectively loan is paid off). My wife has 50k savings. We are buying an IP together for 1m with 20% deposit (50k from my wife and 150k cash funds from my loan). IP loan will be 560k fixed and 240k variable (100% offset). There's no tax implications using my 150k available for redraw as a deposit for the loan? Also, once the IP loan is set up - should I pay off my owner occupied loan first, in order for the larger tax deduction from IP interest? Am i doing it right? Cheers
I think you are about to get some well informed comments about splitting the loan first rather than redrawing to avoid ending up with a mixed loan. I believe by doing this, you would be debt recycling and tax deductions should be ok. Out of curiosity, what kind of yield are you looking at one a 1m IP? It is a yield play or capital gains play?
no, doesn't sound like it. Why using wife's $50k to buy the IP? Why have an offset on the investment loan? How will you access the money in redraw? Look at debt recycling, splitting loans, mixed loans and get some tax advice.
I'm able to take money from the OO Redraw according to the bank. Offset in IP to use funds to pay for expenses. Yield is 4%.
You're not seeing the bigger picture @Sammy1233 . Get some loan structuring advice or read Terry's tax tips (search on the forum). Or even better hire Terry and get it done right from the get go.
