Multiple loans - Strategist/Broker HELP

Hi all,

IP1 Mortgage 1 - 220,000 @ 2.9% Variable P&I 27 years - repayments $976 month - 100% Offset available

IP2 Mortgage 2 - 580,000 @ 3.4% Variable I/O 5 years - repayments $1648 month / reverting to Variable P&I - repayments $2880 - 100% Offset available

IP3 Equity release - 176,000 @ 3.4% Variable I/O 5 years - repayments $499 month / reverting to Variable P&I - repayments $872 - 100% Offset available

I have a couple of questions
1. Which offset should I be dumping excess funds/extra repayments into?
2. Any advantage of leaving my initial PPOR as P&I or should I change it to I/O?

Any advice would be greatly appreciated.

 

Do you have a PPOR? Does it have a loan against it?
The question you are not asking is whether you could refinance some of the loans for a lower rate.
Talk to a mortgage broker.

 

Assuming loans all used by hte same entity you would generally want to offset high rate rather than lower rate, and generally IO over PI to improve cash flow - generally

 

I am renting now so the rental I am in would be classed as my PPOR, originally the P&I loan was my PPOR but it is now rented out. I have already refinanced the 3 loans, the results are what I posted in the question.

 

Now that all loans are Investments you should have them as IO, unless youre in a phrase of paging down your loans.

By the looks of it your current portfolio. Seems like there's a couple of restructures that should be considered.

 

Thanks Tony, the reasoning behind leaving it as P&I is that the rate offered as I/O as an investment was 2.79% so I figured I would just leave it and try to build up some equity in the property.

 

Could be worth fixing loans if you don't have much in offsets and no plans on discharging, can get nearly 60-80 bp discounts on rates which would be a big saving.

Put offset funds into the highest rate loan usually - i.e. the variable one after fixing some.

 

Thanks Terry, That's what I thought but I just wanted some clarification. So I should be putting any excess funds into the IP2 Mortgage 2 - 580,000 @ 3.4% Variable?

 

Prob not. I would consider putting excess funds in an offset initially

 

Thanks Redom, I haven't fixed any of the loans yet so I can ride the low rate period a little longer and then fix once we start hearing of interest rate movement.