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Updating loan on PPR then moving out..

Discussion in 'Property Finance' started by Matty77, 4th Oct, 2015.

  1. Matty77

    Matty77 Active Member

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    So I am moving out of my PPR in Dec and going to rent it out.

    Currently playing PI variable but want to change it to IO variable.

    Now if I do it now will the bank put my interest rate UP in Dec as my PPOR becomes the investment property? Or technically it could still be my PPOR for another 6 years tax wise but I doubt the bank sees it that way..
     
    Last edited: 4th Oct, 2015
  2. Rolf Latham

    Rolf Latham Inciteful (sic) Staff Member Business Plus Member

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    Lender is please ?

    Ta

    Rolf
     
  3. Matty77

    Matty77 Active Member

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  4. jpcashflow

    jpcashflow Well-Known Member Business Member

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    Hi Matty,

    Are you moving out to a property where you will be renting, buying a new places or other situation? What is the difference in repayment amount between P and I vs I only?.

    If you are with ANZ just give them a call and simply ask them... Also if you rate went .27 basis points for is it going to make a huge difference?
     
  5. Corey Batt

    Corey Batt Finance Strategist Business Plus Member

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    Really depends on how your original loan was setup too Matty - it may require a new loan to be orginated to make it IO. What was the LVR on the loan when it was originally setup?

    Else it's just a simple internal refinance, might be a good time to get it all in order and cashout if possible so it can be set and forget when you move out.

    I highly doubt they will jack up the rate on your PPOR loan when you move out unless you give them a reason to. ;)
     
  6. Matty77

    Matty77 Active Member

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    Thanks I thought as much, I was just curious if anyone had been in a similar situation and not told them bank they were moving out. Now if something goes wrong I assume you can be in a whole world of hurt...
     
  7. Corey Batt

    Corey Batt Finance Strategist Business Plus Member

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    People move out of properties, into properties etc all the time - I think you'd end up with a confused customer service rep on the other side of the phone if you called up.

    The more pertinent issue will be changing your loan to IO - check with your banker/broker about this.
     
  8. DaveM

    DaveM Adelaide Buyers Agent & KFC Strategist Business Member

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    There are a number of options and sitting down with a good broker is worth the time. I personally use Corey above and he is local in Adelaide as well, which is a good match perhaps?
     
  9. D.T.

    D.T. Adelaide Property Manager Business Member

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    Hey Matty,

    If you're moving out of the property it might be worth seeing if the loan needs to be restructured to suit. Corey who posted above is in Adelaide and can probably help you.