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Wealth Maximiser - Investor Assist

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Wealth Maximiser - Investor Assist is a specifically designed product that does just what the name implies, provides both an avenue for investors to maximise and enhance their investment portfolio as well as assisting them to better manage their cash flow.

How Does It Work?

Using two different lenders, this sophisticated yet simple loan is structured as follows:

Lender A:
          Home Loan (Interest Only or Principal & Interest)
          Investment Loan (Interest Only)
          (Both loans are secured over the home property)

Lender B:
          Investment Line of Credit (capitalising facility)
          (LOC secured over the investment property)

The shortfall of funds between your investment income and outgoings can be capitalised so that you do not have to utilise your personal income to subsidise your investment costs. Rather, you can utilise your personal income for personal use, be it saving for a holiday, saving for further investment, or applying as much of it as possible to the repayment of your home loan. Investors who chose to capitalise their investment shortfall and are able to apply an additional amount from their personal income to the repayment of their home loan can repay their home loan faster making for a significant saving in interest.

Benefits of Wealth Maximiser - Investor Assist

	Better manage your cash flow - provides a buffer in case of vacancies or reduced dividend income.
	Capitalise the shortfall between investment income and outgoings.
	Utilise personal income for personal use (lifestyle or additional repayments to the home loan.

WEALTH MAXIMISER INVESTOR ASSIST - Rates as at 28/01/09

Home Investment Term Loans	Rates	Comparison Rate
Variable	6.80% p.a	6.83% p.a
Fixed 3 Years	6.45% p.a	6.73% p.a

Investment Line of Credit	Rates	Comparison Rate
Variable Only ($345 annual fee) Variable Only (no annual fee)	6.95% p.a 7.10% p.a.	N/A N/A

Initial Set-up Fees

Application Fee	$350
Valuation Fee	As quoted on each property
Lender's Legal Fees	As quoted
Contract Fee	$150

Product Features at a Glance

Minimum Loan Amount	$150,000
Maximum Loan Amount	$5,000,000 - Lender A (Home & Investment Loan) $750,000 - Lender B (Investment Line of Credit)
Maximum LVR	90% - Lender A (P&I accounts) 80% - Lender A (I/O accounts) 85% - Lender B
Loan Terms up to	30 years
Interest Only up to	10 years - Lender A 15 years - Lender B
Fixed Rate options for up to	5 years
Online Account Management System
Direct Debit
Direct Salary Crediting
Ability to switch between variable and fixed intereset rates (fee applies)
Unrestricted Additional Repayments (Fixed Rate - term portion max. $20,000 p.a. above normal repayments without break cost penalty).
No repayments required until defined credit limit on Investment Line of Credit (Lender B) is reached.
Loan is portable to another security property

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Austral is a member of the Mortgage & Finance Association of Australia (formerly MIAA), the professional body for the mortgage industry.

PH: 02 9299 1833 / FAX: 02 9299 1874

TODAY: Saturday, 4th July, 2009

Private Ruling Authorisation Number 81797 - APRIL 2008
April 2008 Private Ruling Authorisation Number 81797 http://www.ato.gov.au/rba/content.asp?doc=/rba/content/81797.htm Facts: The taxpayer sought to claim as a deduction the capitalised interest on additional borrowings used to meet the shortfall between the rental income on his investment property and the interest, rates and maintenance costs he paid in relation to the property. The taxpayer advised the ATO that he did not want to use his personal income to repay his private home loan debt or reinvest in other income-producing assests.

PUBLIC TAX DETERMINATION DT2008/27
DECEMBER 2008 Public Tax Determination TD2008/27 http://law.ato.gov.au/atolaw/view.htm?locid=TXD (then follow the prompts) TD 2008/27 has now clarified the position for the public generally. The factors that will determine the deductibility of interest are:

My Choice
Austral has recently expanded its product offering through its My Choice loan initiative. My Choice provides borrowers with access to a wide range of lenders and loan products for residential, commercial and equipment finance, so no matter what your need our friendly and experienced staff can assist you.

NAB BOSS TO IGNORE RATE CUTS - APRIL 2009
RESERVE Bank interest rate cuts will no longer have any significant influence on home mortgage rates, a bank chief said yesterday.

WEALTH MAXIMISER - INVESTOR ASSIST UPDATE - JUNE 2008
The ATO has recently published an edited version of a Private Ruling on its website: http://www.ato.gov.au/rba/content.asp?doc=/rba/content/81797.htm A taxpayer and client of Austral Mortgage, applied for the private ruling to seek confirmation from the ATO that if there was a shortfall between his investment income and his investment outgoings then that shortfall could be capitalised under the home and investment loan & line of credit structure noted in his application.

WEALTH MAXIMISER UPDATE - MAY 2008
Ever since the High Court decision in Hart's case, taxpayers have been seeking clarity from the ATO on the deductibility of capitalised interest in certain loan structures. On 16th April 2008 a favourable Private Ruling issued to an Austral client that provides insight into the ATO's current thinking on the subject.

WEALTH MAXIMISER UPDATE - FEBRUARY 2008
Wealth Maximiser Update 12th February 2008 - We have advice from the ATO that it is well advanced on a binding Tax Determination regarding the deductibility of capitalised interest on a line of credit facility. Borrowers with both a home loan and an investment loan should consider including a capitalising line of credit within their loan structure or at least ascertaining from their lender that they could access such a facility by way of a simple variation of their existing mortgage.

Trans Tasman Finance
Did you know that Austral has a wholly owned subsidiary, Gem Home Loans Limited, in Auckland NZ - we are able to assist with organising mortgage finance for you should you be considering buying property in NZ.

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