What to check when income drops, a fixed or interest-only term ends, or a relationship changes. Most of it is easier to arrange before the change than after.
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An income drop or a loan term ending is a cash flow event, not a strategy failure. The split keeps its purpose and its tracing; what changes is your capacity to service it and what a lender will approve.
Each section follows our guides on an income drop mid-recycle, fixed rate expiry and interest-only expiry. Separation is covered in general terms only: get legal advice first.
Where the lending needs to change, refinancing to keep the split clean is easier while your income still supports an application.
Alex can look at how your loan is set up and tell you what would need to change. Free, no-obligation call, by phone or video.
Request a call with Alex →Generally not. Deductibility rests on what the borrowed money was used for when it was drawn, and losing income does not revisit that. What changes is the value of the deduction, because it reduces tax at a lower marginal rate. Your tax agent confirms your position.
It reverses the logic of the strategy. It clears deductible debt while the non-deductible home loan remains, and turns cash into equity you would need to reapply to borrow back, possibly when your income no longer supports an application. Holding it in offset on the home split keeps options open.
Separation outcomes are dealt with under family law, so get legal advice before changing any loan, title or investment. On the lending side, removing a borrower or restructuring the loan is a new credit decision. We can explain the lending options once your legal position is clear.
Parental leave, redundancy and reduced hours mid-recycle.
Read more → GUIDETiming the recycle around your fixed rate expiry.
Read more → GUIDEWhat reverting does to your deductible balance.
Read more →
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4. Communicated well throughout.
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