Hi,
I bought a PPOR back in 2013 and have my mortgage with ANZ. I currently owe $400K on it and my interest rate is approx 5.2% ($100K variable and $300K fixed).
I had a re-val done in December 2014 and it came back at $500K, meaning I have $100K equity ($80K usable).
Anyway, I have recently sold a business of mine and suddenly have $35K in cash to add to this.
With all this equity / cash floating around I'm set on buying my first IP, but not quite sure how best to approach it.
A few questions:
1. With interest rates being so low, should I refinance to get away from ANZ's ~5.2% rate to something more like ~4.3% (uBank and some others are close to this). I've worked out this could save me approx $5K per year.
2. If I were to buy my first IP, should I pay the $35K onto my loan, then use that equity as security? I.e. putting that money on my mortgage would not only reduce my monthly payments but I could still get my IP.
3. Or do I keep these things separate, and just use the cash as deposit for my IP? I'm looking at buying a 2 bed unit in Wollongong at approx $350K so $35K should cover 5% deposit + costs.
I think either way I want to achieve 2 things, refinance to a lower interest rate, and buy my first IP.
Any help would be great.
Thanks!
I bought a PPOR back in 2013 and have my mortgage with ANZ. I currently owe $400K on it and my interest rate is approx 5.2% ($100K variable and $300K fixed).
I had a re-val done in December 2014 and it came back at $500K, meaning I have $100K equity ($80K usable).
Anyway, I have recently sold a business of mine and suddenly have $35K in cash to add to this.
With all this equity / cash floating around I'm set on buying my first IP, but not quite sure how best to approach it.
A few questions:
1. With interest rates being so low, should I refinance to get away from ANZ's ~5.2% rate to something more like ~4.3% (uBank and some others are close to this). I've worked out this could save me approx $5K per year.
2. If I were to buy my first IP, should I pay the $35K onto my loan, then use that equity as security? I.e. putting that money on my mortgage would not only reduce my monthly payments but I could still get my IP.
3. Or do I keep these things separate, and just use the cash as deposit for my IP? I'm looking at buying a 2 bed unit in Wollongong at approx $350K so $35K should cover 5% deposit + costs.
I think either way I want to achieve 2 things, refinance to a lower interest rate, and buy my first IP.
Any help would be great.
Thanks!