Is this what you describe (with imaginary figures): Mother borrows 50k at 7%, she lends this to her son at 7.2%. Because the loan was for the purpose of producing income practically all of the income is offset by her interest payments so her situation is not affected much. The son uses the 50k to buy his property, borrowing another 300k in his own…[Read more]

Thanks for your input guys. I did a lot of reading on the ATO website this morning and from what I can tell Mike is right, so it’s all good.

By the way, the property was bought long after the 80s, probably around 95-96.

Cheers,
Carl

Thanks for your response Michael. I’ve read through the PDFs on your website and I’ve decided that I really need to do a bit more research/reading. Might be a good idea to stop by Borders on the way home tonight and pick up some reading material for the weekend..

Thanks again for your response Terry, I will definately look into the board/rent deal. That would make a big difference to where we’re going I think..

Thanks for your input Simon

You’re right, starting at the start would really be to just build one house. However, unless all 3 partners went into the development as a joint venture there wouldn’t be enough capital to get the ball rolling yet. I’ve always been told that when developing as a joint venture it is a top idea to keep separate titles,…[Read more]

Thanks for your input Terry

If drawing on the homeloan can’t provide tax deductions through interest/rates/repairs etc then it might be a better idea to just pay the homeloan out, then use the house as security and finance an IP 100%. Then there would be no question that the borrowed money was used to produce income. Is that possible?

The…[Read more]