Best Lenders for Debt Recycling?

Bruiserh89 on 08/06/2023 - 08:34

Hi

Just wondering what the best lenders are for debt recycling your mortgage? The major requirement I have is to be able to split my mortgage into several parts. AMP seem to be the best as they allow for up to 10 splits. Is there anyone else. Limitations of just one split won't work for me as I will be looking to add further splits in time for debt recycling. Does anyone use another lender? Also good if there is a offset account option for the original mortgage amount.

Thanks
Bruiser

Financial

Comments

  • JimmyF on 08/06/2023 - 10:01
    +1

    The major requirement I have is to be able to split my mortgage into several parts

    For those of us not in know, what is the advantage of splitting the mortgage up like this?

  • Daff on 08/06/2023 - 11:00

    Is debt recycling still viable with current interest rates?

    • Poppin on 08/06/2023 - 11:35

      Yes, even more so since you are converting non-deductable debt into deductable debt. No increasing your overall debt.

      • Bruiserh89 on 08/06/2023 - 16:36

        exactly

      • Daff on 08/06/2023 - 16:55

        Sure, but you're maintaining a level of debt instead of reducing it. If the gains aren't offsetting the interests incurred, even with deduction, then it's of less value.

        • poboy on 08/06/2023 - 19:41

          The higher your tax bracket, the better your return, as you can deduct your interest and get 42% of it back vs 30% if you are on a lower tax tier.

  • kipps on 08/06/2023 - 11:10
    +1

    Macquarie Bank is also a great option.

    • Bruiserh89 on 26/08/2023 - 16:18

      Thanks. I ended up going with Macquarie.

  • Dundundunnnn on 08/06/2023 - 17:40
    +1

    NAB on their package works for me. Several splits.

  • tomclancy on 09/06/2023 - 10:05
    +1

    Debt recycling is a fad invented by mortgage brokers in order to win more customers.

    The ATO don't look at the structure of the loan, rather the purpose of the funds being redrawn. Here is TR2000/2 - a taxation ruling made in 2000 specifically dealing with this and confirming that interest on the portion of redrawn funds used for taxable purposes is tax deductible. You don't need loan splits, just a record of the redraw amounts and dates you made them.

    The only reason you would want multiple loan splits is if you want the bank to spoon feed the interest calculations to you. But a simple excel spreadsheet is all you need. Any lender that provides unlimited loan splits (like Pepper/MyLoan Elect) will be poorly priced and you'll be paying for the service.

    Plenty of ATO Community discussion if you search for 'Debt Recycling' there

  • arctan on 09/06/2023 - 13:58

    Anyone using St George for debt recycling purpose? Does it work well?

Login or Join to leave a comment
Login Join