Trusting the Wrap

Hello all,

I'm hoping that I might receive some feedback from those having conducted vendor finance transactions -

Should I perform VF transactions through a trust? If so, a HDT or Unit Trust?

If a trust is used, does the trust afford the client any particular protection wrt his property, other than lessening the chance of creditors gaining access to my assets - and the client's future home? Ie. does the use of a trust for a wrap transaction provide you with any additional selling points which might help secure the client?

Are there particular benefit in running vendor finance transactions as a business, using a separate business trust, rather than operating as an individual, using the individual's usual investment trust?

Thanks to all.
Regards

Fish

Hi Fish

I'd suggest you sit down and discuss these very important questions with a "switched on" accountant.

In the meantime, if you'd like to educate yourself on these subjects, I'd recommend Steve's "Wealth Guardian" kit which is available on this site. It's an easy read and is a fantastic educational resource.

I hope this helps.

Cheers, Paul

Hi Paul,

Thanks for the reply.
Tried to get WealthGuardian which sounded great...but no longer available.
Seeing the Accountant today.

Hope I know enough to know whether he's switched on.

Cheers

Fish

I am not an accountant, but have wrapped myself and I have used a discretionary trust. Since you will be making positive cashflow, there is probably no need to use a hybrid trust, and I can see no point in using a unit trust (unless in partnership?).

Using a trust would not really have any effect on the end purchaser other than protetion of your assets against external creditors.

Terryw
Discover Home Loans
North Sydney
terry@discoverhomeloans.com.au

Hi Fish

Sorry to hear that it's no longer available. I found it to be an invaluable resource.

You you are going to talk about a "trust structure" with your accountant, make sure he/she explains to you the benefits of using a registered company as the trustee of the trust.

Cheers, Paul