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Determine the current debt prior to borrowing the deposit

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Reference no: EM133091028

Question - You have been approached by a customer for assistance to purchase an investment property, they intend to access the equity in their home for the deposit. As they do not wish to use LMI. They will borrow 80% LVR on the investment property. You are required to determine the current balance on their home loan using the information below-

Investment property purchase price $830,000

Home value & 750,000

The LVR after refinancing the current loan to accommodate the deposit for the investment property is 74%.

Required - Determine the current debt prior to borrowing the deposit?

1. $389,000

2. $555,000

3. $166,000

4. $614,200

Reference no: EM133091028

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