I have a PPOR with Qantas Money Home Loans. They do not offer split loans.
Do any banks offer investments loans for share investing, where the collateral is a house mortgaged with a different lender?
Investment Loans from Lender A with Mortgage from Lender B
space cadet on 30/08/2025 - 12:43
Comments
You've nailed it, I'm just seeing if there's a way to avoid the hassle of refinancing in order to do it.
Some banks will take a second mortgage behind the first mortgage holder but be prepared to pay a higher rate of interest.
Market hitting new highs, unsophisticated investors seeking leveraged access to equities.
Better get my shoes shined and see if there are any tips.I'm new to the game so may indeed be wrong about this - but I'm not after a margin loan for shares, which I thought was leveraging? Rather I'm looking at debt recycling like @soan papdi suggested.
Thats cool until half the value of your house drops in value by 50% in a day.
As long as it's only half the value of the house dropping by half…
Good luck, go easy to begin with.
Investment loans are about 6%, inflation about 3% so you need a return of at least 10% before it’s even worth it
Which works with average S+P returns around 10.33% per year, plus tax treatment of investment debt. I guess if you were planning to invest anyway. leverage/recycling debt is a no-brainer.
So you will barely break even. What’s the point?
Just save and use your own money
Keep in mind inflation is 3% regardless of your fund your investment.
Consider you have $50k you want to invest. You can make a market return of 10% or pay down/offset your owner occupied loan at 5.5%. You also have access to an investment loan at 6%.Offset - 5.5% * $50k = $2,750 tax free
Invest - 10% * $50k = $5,000 less tax ($2,750 after tax at top bracket)You wouldn't risk it. right?
However, if you put the $50k into your home loan, and get the investment loan, your debt position stays the same.
You invest again so $5,000 return, less tax, however you claim the interest you paid in your tax return (6%50k45% - $1,350)
So your return after tax is $2750+$1350 = $4,100Do that for 20 years and you're laughing.
@jbu22en: Yeah in numbers these things look good but there are factors that need to be considered.
- Interest can only be claimed if shares are income generating, i.e., pay dividend.
- 10% returns are not guaranteed.
What if the OP is trying the "get rich quick by investing in share" scheme and buys all small caps with "unlimited potential".
The scenario you have put only works if it is an investment like a Index fund that also generates dividends.
@Megatron: This comment isn't super helpful… it seems like your only contribution here is to neg…
- I'm not an accountant, but I don't think this is necessarily true - plenty of other non-income generating investments are allowed tax deductions (ie. vacant investment properties, start up investments etc.)
- Obviously 10% returns aren't guaranteed, it's averaged over time which I stated in my comment - 2 of the last 3 years S+P did 20%+, and the year before did -20%…
- Who cares what if? My reply to Dollar General's comment was to highlight the benefit of debt recycling vs investing with savings, assuming the investments were identical
- This is also not true … debt recycling can also be done for property investment
@jbu22en: All I can say is you need to go and learn some Tax accountin before you start providing financial advise to people in online forums.. have you been claiming interest for non-income generating shares using the same scheme? If you are, you have an option to correct your tax returns or wait until ATO catches you.
Read ATO's response here -
https://community.ato.gov.au/s/question/a0JRF000001rv9F/p003…Regarding Vacant Investment properties, again you are wrong as it depends on the type of property and "intent". Vacant land, you cant claim Interest unless a business is being operated from the land itself. Vacant property, the rule is if it is available for rent (generally means advertised) and remains empty, you can claim interest.. or if it is a vacancy period between two tenancies due to a situation like renovations.
Seriously due, please go learn some basics of Tax accounting at least for your own good.
@Megatron: While I loathe continuing these conversations, you've waded beyond your depth and are relying on forum posts to support your argument.
Word for word from the ATO website (and not a forum post)
https://www.ato.gov.au/individuals-and-families/income-deduc…
"If you borrow money to buy shares or other investments from which you earn dividends or other assessable income, you can claim a deduction for the interest you pay."
This line is from the same page:
"Only interest expenses you incur for an income-producing purpose are deductible."
I trust you accept that realised capital gains are a form of assessable income (else it's you who will be reviewing their returns).
@jbu22en: it is generally not my nature to reply to half-witted posts, so I will let it be.. have fun with your hypothesis and understanding of financial accounting :)
Technically a loan split is not required to begin debt recycling, though it makes the reconciliation much easier.
As long as you cleanly deposit your funds, and redraw them into an investment account, you can demonstrate the purpose of the funds if the ATO ever had any questions. Ensure your dividends are paid to a separate account, and funnelled into your mortgage using a description that you can easily identify as a PPOR principal reduction, you should be fine.
Re your comment on debt recycling vs leveraged investing vs margin loans, check out this explainer: debt-recycler.aufintools.com/learn
no that's not really correct.
yes you can deposit and withdraw and change the purpose of the funds but then you can't point to a repayment and say this $100 is only paying my PPOR portion and none of my investment portion. it'll get apportioned across the total loan
that's why a split is best
It's correct, it's not required - a split is obviously better, and better again is often a completely separate loan, but let's not confuse what's optimal vs what's possible. I'd like to also point out, OP will be claiming the interest paid, not the repayments itself. This is quite straight forward to calculate.
https://passiveinvestingaustralia.com/debt-recycling/
This is called debt recycling. Move to a lender who can offer split loans.