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Will this loop hole work? RE: Homeloan

Discussion in 'Property Finance' started by fullylucky, 3rd Sep, 2015.

  1. fullylucky

    fullylucky Well-Known Member

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    I've almost paid off my homeloan for PPOR.

    as you all aware the investment loan interest rate increased recently....

    So I was thinking is it possible to do this loophole? has anyone tried?

    What if.... you say you moved to the investment property and live there. So that means it's no longer and investment loan. It's PPOR loan.

    Will banks then reduce the interest rate by .27% ?

    Do you understand what I'm saying? o_Oo_Oo_O
     
    Esh likes this.
  2. thatbum

    thatbum Well-Known Member

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    I think you're onto something.

    I just thought of another loan loophole too. If you're capped for serviceability, you can just tell the bank you moved out and now rent out your PPOR for $xxxx/per week. And make up a fake lease agreement to that effect.

    And then the bank will let you borrow more?

    Do you understand what I'm saying? o_Oo_Oo_O
     
  3. Kinnon Bell

    Kinnon Bell Finance Broker

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    So, basically, commit fraud to save 27 bps? Or are you actually intending to move into the property?

    What about other considerations such as tax etc.
     
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  4. spludgey

    spludgey Well-Known Member

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  5. miked

    miked Well-Known Member

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  6. wylie

    wylie Moderator Staff Member

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  7. spludgey

    spludgey Well-Known Member

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    Note to self: Learn to read!
     
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  8. miked

    miked Well-Known Member

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    It's OK, this is the Internet. No need to actually read articles!
     
  9. fullylucky

    fullylucky Well-Known Member

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    Actually intend.

    Can you help me think through it with regards to the tax?

    Will it be worth it?
     
  10. pinkboy

    pinkboy Well-Known Member Premium Member

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    ^^
    Gets @r$e spanked in jail....but saves on tax.

    pinkboy
     
  11. tobe

    tobe Well-Known Member

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    If you are actually moving in, it ain't a loophole.
     
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  12. fullylucky

    fullylucky Well-Known Member

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    So has anyone tried contacting their bank and actually doing it?
    Did they reduce the interest rate?
     
  13. Peter_Tersteeg

    Peter_Tersteeg Finance broker and strategist Business Member

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    I was reading about this very thing earlier this morning. A lot of people actually have moved into an IP and lenders are seeing a lot of people contacting them to get the information straight.

    We've done quite a bit of paperwork in the paperwork with several lenders to get this recognised.

    To the best of my knowledge, in each case it is quite legitimate. Don't try be clever just for the sake of taking your rates back to what they were in February.
     
  14. Art Vandelay

    Art Vandelay Well-Known Member

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    Tell the Office of State Revenue that it's your PPOR and save on stamp duty as well? Double win!
     
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  15. wylie

    wylie Moderator Staff Member

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    Did you mean "save on land tax"? Stamp duty would already have been paid on purchase so moving in wouldn't make a difference, or am I missing something?
     
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  16. Art Vandelay

    Art Vandelay Well-Known Member

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    No - you're right Wylie.
    I misread the OP that he was going to buy an IP and claim it was going to be his PPOR in order to get a better rate.
     
  17. DanW

    DanW Well-Known Member

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    The time spent on trying to reduce your cost - why not spend it on increasing your income? Probably the same payoff, and it wouldn't be a loophole ;)
     
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  18. Bran

    Bran Well-Known Member

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    Yes - they will refund. I'm in the process of it. I legitimately bought an IP, but then we decided to move in. Forgot to tell the bank so far.
     
  19. wylie

    wylie Moderator Staff Member

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    Did you ever rent it out? I'm guessing not. Someone in the OSR has a heart???
     
  20. Bran

    Bran Well-Known Member

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    Nope. They weren't fussed, I just told them it was an error on our part. They gave me some paperwork, but I need someone official to sign it, and just haven't got around to it (story of my life).