How to pay off your home sooner

If you have an exisiting investment property, or are considering one in the future you could do just that through an exciting financial planning product called Mortgage Down.

Never heard of it? We are not surprised. Find out how it works, what is involved, and how to get it for yourself.

What is Mortgage Down?

Say you are paying off the home you live in, and an investment property. You are paying a similar interest rate on both, however only the interest on the investment property is eligible for tax deductions.

What if you could shift things so that the interest rate you paid on your home was reduced, and the interest rate on your investment property was increased?

The same total interest % paid for the two properties combined, but your mortgage payments for your home are now paying off a higher proportion of the principle on your home loan and less interest.

Mortgage Down can be extremely beneficial for situations where the investment property value is higher than the value of the owner occupied home. The amount that you are able to change your interest rates can be calculated by your advisor based on your individual circumstances. The Ceiling and Floor Interest Rates are set above the Reserve Bank of Australia cash rate.

What does this mean for paying off my home?

Using the Mortgage Down financial planning tool could mean tens, and in some case hundreds of thousands of dollars saved on interest. This will vary depending on loan sizes and any principle already paid- and significantly reduce the years needed to pay off your home loan.

An increase in the investment interest rate on your investment property means a greater amount (interest paid) may be eligible as a tax deduction, a further saving for you!

What does this mean for my investment property?

Paying a higher interest rate on your investment property means that this higher amount may be eligible for tax deductions, a further saving for you.

What if I have a plan for multiple investment properties?

Paying off the principle in your home loan faster could mean you can then utilise the equity in that home to purchase subsequent properties, and have multiple rental income streams which you could put towards your mortgage payments.

What is the advantage of a dual occupancy home with a Mortgage Down plan?

This tool is relatively new to the game, with the ATO only approving its use in 2015. As a result there are many financial professionals who are not familiar with it, or not appropriately accredited and licensed.

The second advantage to a Dual Key Home in conjunction with the Mortgage Down tool is achieving two rental income streams in combination with reduced outgoing expenses in some cases.

How can I find out if Mortgage Down could work for me?

You can contact us to organise an obligation free consultation to discuss your eligibility for utilising Mortgage Down as part of your positive cashflow investment strategy in acquiring a new investment property, as well as investigate the suitable properties available at the moment or in the future.

There are single occupancy, dual occupancy single title, or duplex homes available with Dual Key Homes today and throughout the year, and the advantages or disadvantages of each option can be discussed to determine the best outcome for you.