Page 16 - Loan Structure Solutions

on any interest only loan. However, you have the flexibility to reduce
the repayment to interest only at any time.

Perhaps a better quality question would be; what should you repay –
P&I or interest only? That is more of a financial planning question
rather than a loan structuring question. We would always try and
structure a loan that provides the maximum flexibility – which is interest
only.

11) Structure and mortgage insurance

Again, this is a separate topic in itself. However, suffice to say that if
you need to borrow more than 80% and pay for lenders mortgage
insurance, there are ways to minimise this cost through loan
structuring. Therefore, if you are in mortgage insurance territory, make
sure that you get some independent advice in regards to the structure
and lender(s) you use as it could literally save you tens of thousands of
dollars.

Part C: Structuring through entities

More people are now buying
property in structures other than
their personal name. This might
be seen as a positive step as it
shows that investors are starting
to think more strategically.
However, as with any added
complexity, it brings with it
additional considerations that
might not be identified by your
accountant (who typically es-
tablishes these structures) and/or
your mortgage broker. Therefore,
my first tip is to ensure that your lending advisor has plenty of
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