Question for a mortgage broker

I have 35k cash

I am looking at buying a 500k property (assume it is an investment and cash flow neutral and assume that my income is enough to meet serviceability requirements)
Stamp duty would be 18k, legals 2k
The deposit would be around 15k (I have to negotiate with the seller on this)

I own another property worth 650k with 130k mortgage

Would I be able to purchase a property worth 500k by using that equity?

I am happy to go to 90% or 95% LVR for the new purchase. However, I am not sure if I am required to pay LMI in cash or if I have enough cash to purchase a property

 

What you havent mentioned is your income. The ip being cashflow neutral doesnt actually matter much.

 

Yes potentially.
You can't use equity per se, but you can borrow against a property with equity.
Terryw’s Ideal Loan Structure Terryw’s Ideal Loan Structure

 

Just edited my post. At this stage I am only considering the cash/capital requirement component

 

no need for either cash or LMI

 

yeah but whats the point if your loan app then fails on serviceability? You are looking for a total of 650k loans assessed at 9% pandi.

the easy answer is that you have lots of security to give to the bank. You dont need cash at all.

where you might fall down is serviceability or cross colling (if they say you dont have to pay lmi at all!)

 

Provided you can meet servicing requirements, you don't need to use your cash towards the purchase. You have plenty of equity to be able to get a loan of $120k against your current property and borrow 80% for the purchase.

If you need to pay the deposit quickly, you could see if the vendor will accept a deposit bond, so you have time to sort out the finance for 100% of the purchase price plus costs.

 

There is more then enough equity to use and no deposit is needed

Draw the 20% deposit + stamp from INV to use and borrow the remainder of 80% against the new INV.

No LMI needed ..

 

Thanks everyone for your responses

 

Do I need a MB or Expert in Loan Structure Advice if I want to start new loan for potential IP with the money sitting in PPOR offset so the total PPOR loan gets reduced?

 

Both

 

That sounds like Terry's exact job description!