Debt Recycling - How? or a better strategy??

Hi There,

I was wondering if there was a better solution to my problem?
Any advice would be very appreciated.

I had a $90k equity loan on my PPOR funding part of an investment property.
I have an investment loan for the remaining amount on the investment property. Property purchased about 3 years ago with equity of approx. $100k.
Long story but when I sold my PPOR the equity loan got payed out by sale proceeds.

I am soon to purchase a new PPOR, my home loan will be an extra $90k larger and that portion is not tax deductable (non investment related).

Is there a way of paying the PPOR down $90k and making it tax deductable?

I know of Debt recycling by capitalising investment costs (ex interest) and paying down PPOR debt with rental funds but this is a slow process.

Are there other options / advice that may help?

 

There is a way, but if you have paid down the loan already then you had missed it.

You could have refinanced that $90k loan so you didn't have to pay it off.

see
Tax Tip 74: Selling a property that secures other loans https://propertychat.com.au/communi...ing-a-property-that-secures-other-loans.5296/

 

As I mentioned in the original post the loan has already been paid out

 

In that case you have made a costly mistake.

Interest on $90k would be around $4500 per year. This means you will have $4500 less tax deductions for the next 20 to 30 years.

no way to rectify this now.

All you can do is some debt recycling. Borrow to invest and use the proceeds to pay down the loan on the new PPOR, keep repeating.

 

I am aware of the situation I am in. As per my original post I am after some advice or ideas that others may have done. Thanks

 

You can't unscramble an omelette.

 

I am aware of the situation I am in. As per my original post I am after some advice or ideas that others may have done. Thanks