Howdy, After some clarification as to whether what I'm looking to do is possible. At present I have a 9 year old PPOR which has been refinanced once and has seen various extra repayments, direct to the loan, and various redraws of the extra repayments. None of these have been for any income generating purposes, ie car etc. This I believe makes it a mixed loan. We're now at a point we'd like to invest. Unmixing this loan would be a nightmare based on it's history. However if I refinance to release equity and split the released equity at the same time would the equity split be deductible? ie before: Property value: 600k PPOR (mixed): 300k Redraw available: 60k after refinance: Split 1:300k Split1 Offset (60k) Split 2: 150k (equity redraw) Would split 2 be deductible? Thanks
Refinancing won't suddenly fixed a mixed loan. It needs to be unmixed. But since it is a loan relating to a main residence it may only matter if that house ends up being income producing. If you borrow to invest in income producing assets the interest would generally be deducitble. so split 2 could be deductible, whether you refinanced or not.
