SearchMaximising benefits?
Deepthi asks:
(updated on Wednesday, May 01st 2013)
We are looking at buying a new home and making the current property an investment property. The mortgage left on the current property is only $100,000, is there a way to change the mortgage profile to maximise tax benefits?
Our Experts Answer:
You'll want to get advise from your accountant in regards to this but normally we recommend to max the debt out on the investment property so you have as much equity in your own home as possible. We generally recommend a split banking arrangement here where you have the investment lender with one bank and your new personal residence with a different one. This is so that the mortgages and properties are not cross secured. From a tax point of view, remember you want to maximise the benefits to have the investment debt on interest only while you look to pay off the personal debt connected to your own home.
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