I have two seperate mortgages on two different interest rates,
which I would like to swap over with the bank. Is this a good idea?
Q.
I have an investment property on which I have a mortgage of
$163,000 (variable rate of 5.04%) and I live in my own property
which has a mortgage of $163,000 (fixed rate of 6.59%). I am
thinking of requesting my bank to swap the two loans with each
other. After the swap, I will be able to pay off the variable rate
mortgage on my own property at a faster rate and it will also allow
me to claim interest deductions on the investment property at the
higher fixed interest rate. Please advise if this is the right
thing to do from the tax perspective.
A.
This is a good idea if you can do it but it will depend on the
terms of the loan on each property. Your bank will be able to
explain what options are available to you.
Each week financial advisor Noel Whittaker answers your
questions.
