Member Success Story: A Multi-Property Refinancing Triumph!

Refinancing can be a daunting task, especially when dealing with multiple investment properties. However, sometimes, with the right strategy and financial expertise, it can become a tremendous opportunity for growth and savings. In this blog post, we will share the remarkable success story of a Property Club member who, with our expert guidance, achieved a significant transformation in their investment portfolio. Through a series of smart financial moves and strategic refinancing, we were able to restructure their investment debt and unlock substantial savings, positioning them for a more secure financial future.

Restructuring Investment Debt

The Club member owned four investment properties, each with its respective financial obligations. The challenge was to streamline the debt across all these properties to create a more efficient and manageable structure. By leveraging the expertise of our mortgage brokers, they were able to consolidate their debts into a more unified, cohesive package. This step alone significantly reduced the complexity of managing multiple property loans and laid the groundwork for greater financial flexibility.

Optimising Loan-to-Value Ratio (LVR)

One of the key strategies in this refinancing success story was the optimisation of the Loan-to-Value Ratio (LVR). The mortgage broker worked diligently to ensure that the LVR against any one investment property did not exceed 70%. By doing so, they secured lower interest rates, making the financial burden more manageable.

Breaking Cross Collateralisation

The mortgage broker was able to break the cross collateralisation across the Club member's four investment properties and their owner-occupied home. This allowed for more individual control over each property's financial dealings, granting the freedom to make strategic decisions independently.

Minimising Debt and Risk to Owner-Occupied Dwelling

The Club member's owner-occupied dwelling represented a significant asset and played a pivotal role in their overall financial security. However, having investment debt intertwined with their primary residence introduced unnecessary risks. Through careful refinancing maneuvers, the mortgage broker was able to minimise the debt and risks to the own home, safeguarding its value and providing greater peace of mind.

Transition to Interest-Only Debt

Striking a balance between capital growth and cash flow is crucial for successful property investment. The mortgage broker guided the Club member to revert all investment debt to interest-only for the next five years. This approach provided immediate relief in monthly payments, freeing up cash flow for other investment opportunities. Additionally, the interest-only period created an ideal environment for the properties to grow in value, maximising their potential return on investment.

Impressive Savings

The tangible outcome of this refinancing journey was astounding. By restructuring the investment debt, optimising the LVR, breaking cross collateralisation, and transitioning to interest-only debt, the Club member saved an incredible $13,143 per annum in payments. Over the term of these facilities, this represented astonishing total savings of $221,486 if the facitilities run their full term. Such financial gains provide the Club member with increased liquidity, enabling them to explore further investment ventures or to enhance their lifestyle choices.

The success story of this Club member's refinancing journey demonstrates the importance of seeking professional financial advice and expertise when dealing with complex investment portfolios.

If you are considering refinancing or looking to optimise your investment portfolio, please get in touch with us at enquiries@propertyclub.com.au.