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Increasing from 80 to 90 LVR to buy new IP

Discussion in 'Property Finance' started by BenWa, 17th Oct, 2016.

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  1. BenWa

    BenWa Member

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    Hi all,

    I have an IP loan with CBA at 80% LVR that I'd like to increase to 90% LVR so I can use the funds to buy a new IP. Is this a relatively straightforward process or are there better and worse ways to do it? I have a small amount of capital growth equity in the property too.

    Cheers,

    Ben
     
    Last edited: 17th Oct, 2016
  2. Ardi

    Ardi Well-Known Member

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    Some of the brokers will be able to give you more detail. But you might be better off going with 88% as there is a fair jump in lmi over that.
     
  3. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    Relatively straight forward. Just use a new split, don't mix and don't allow the money to make any detours.
     
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  4. Peter_Tersteeg

    Peter_Tersteeg Finance broker and strategist Business Member

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    88% + LMI is effectively 90%. Most lenders won't let you borrow more than this for investment purposes anyway.

    The CBA is one of the few remaining lenders that actually will allow cash out (equity release to cash) above 80% without heavy restrictions. They'd want a pre-approval for the next purchase, but this might work in the OPs favor.

    Keep in mind that if the loan wasn't previously mortgage insured, LMI will need to be paid on the full amount, not just the increase.
     
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  5. Colin Rice

    Colin Rice Mortgage Broker Australia Wide Business Member

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    Its a straight forward process if you know what you are doing?

    Get a broker to assist you as no doubt some other "value add" suggestions will be made assuming they know there stuff :)