investment property loan

[Kassiasmum]

Hi,
We are looking at buying a new house and using our existing one as an investment property. Now I know absolutely nothing about investment properties so I may be way off base with my thinking here, but I am sure you can set me straight. What I was hoping to be able to do was have the smaller mortgage on the new house and the bigger on the current one which will become the investment property, so when borrowing the money, is there any way that you can swap the mortgages around I suppose (I know I am not explaining this very well so hopefully you understand what I mean) so that this happens.
Thanks for you help, oh and by the way we will be seeing a financial planner to help us with this as well.

[andie_pandie]

Hi Kassiasmum

Thank you for your post, this is one of those posts that I am sorry I cannot give any advise on due to the nature of the question. I am glad that you are consulting a financial planner, and or a Tax Advisor.

From a lending point of view, you are unable to change the purpose of the borrowing ie: from Owner Occupied to Investment. When you purchase a property the Government charges relevant fees applicable to whether it is a Owner Occupied Property (Regulated)or Investment (Unregulated) Property.

I understand your reasoning for wanting to do this, and for this reason it is very important to get advise accordingly because of possible tax implications.

Please feel free to PM me if you need me to clarify the above, or if you need any generic lending information, ie equity or borrowing capacity.

Regards Andrea

[Kassiasmum]

Thanks for your time and advise, greatly appreciated.

[andie_pandie]

You are welcome, if you need me for anything more let me know.

Regards Andrea