Transfer of security PPOR

Discussion in 'Accounting & Tax' started by smator, 17th Oct, 2016.

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  1. smator

    smator Well-Known Member

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    Hi guys

    I've sold my PPOR and am buying a new PPOR (similar price). Broker has suggested transferring the security of the loan and keeping the same loan. Is there a way to do this so that if the new PPOR becomes an investment property down the track the interest will be deductible? Can you do this by repaying the loan and then redrawing? Not sure how timing would work...
     
    smator, 17th Oct, 2016
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  2. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    The interest on the loan that relates to the purchase of the property could be deductible.

    But to be safe I would pay back the existing loan and borrow 80% or 105% of the new purchase.
     
    Terry_w, 17th Oct, 2016
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  3. Rob G

    Rob G Well-Known Member

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    And place surplus proceeds in an offset account linked to that borrowing ???
     
    Rob G, 17th Oct, 2016
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  4. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    Yes - so there should be no extra interest incurred.
     
    Terry_w, 17th Oct, 2016
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  5. smator

    smator Well-Known Member

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    with a new loan facility?
     
    smator, 18th Oct, 2016
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  6. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    Yes
     
    Terry_w, 18th Oct, 2016
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  7. smator

    smator Well-Known Member

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    Thanks
     
    smator, 18th Oct, 2016
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