s0805 wrote:

TheFinanceShop wrote:
I would generally go for an standard product with a linked offset and I would do this for each loan account or do it as a redraw as some lenders like 

Shahin,  valuation is on to do list……but i m sure that I'll have to go up to 90% this time……standard product with offset is my preferred method as…[Read more]

s0805 wrote:

Terryw wrote:
LMI wouldn't be deductible in full because part of it would relate to the existing properties. Probably base it on a % of the total amount borrowed.

Terry, I am borrowing upto 90% off existing properties (1 PPOR & 1 IP) to fund my second IP….which is for investment purposes. In that case shouldn't LMI on both…[Read more]

god_of_money wrote:
Hi Terry

Can you elaborate more about
"they can earn over $20k pa and not pay tax for income received from a testamentary trust"

I thought children < 18 can only earn up to A$416 without paying tax.

s102AG ITAA36
income from a will or a trust set up on death is excepted trust income and taxed at adult rates. Can also…[Read more]

LMI wouldn't be deductible in full because part of it would relate to the existing properties. Probably base it on a % of the total amount borrowed.

I would suggest you get a LOC on each property – ideally. If small amounts this may not be practical.

manolo76 wrote:
Hi Terry. Thanks. I will dig a little bit more in depth after your comments.
In regard to the land tax… we are in NSW.
By the way what is the current situation with non working children as beneficiaries of a trust

Hi M,

It doesn't really matter where you are, but where the property is located!

Children can earn $416 pa…[Read more]

PTW wrote:
Hi there

A little about my situation first. Married, no kids, wife doesn't work, I'm 46yo, we own our own home, car and some shares = +$1m. I earn >$200K.

I've just bought off the plan my first IP within 2k of the cbd for about 500k due completion early 2015. This should rent for 550-600/week.

Doing the math I could pay this out in…[Read more]

ChristineNurse wrote:
Terry / Richard,

With all the experience and learning lessons you both had, have you considered writing a book or better still, coming up with a online education course thingy? We freshies (new investors) can learn from you.

Hi Christine

I am in the process of writing several books.
One on tax
one on trusts
one on the…[Read more]

M: Based on this, i do not see any point in buying in the name of a company in my situation. Do you agree?
T: There can be some reasons to buy in the company name. One is land tax. But this would depend on where you are buying

M: I have read somewhere that in this scenario if one trust incurred losses from one property…. then this can offset…[Read more]

Hi Manolo

I think you must have misunderstood your accountant as what you have written above is strange and wrong.

If the company is buying the property in its own right then the tax on the income will be fixed at 30%. The company can pay dividends to the shareholder which is the trust. But trusts cannot retain income (or be taxed at 45%) so the…[Read more]

manolo76 wrote:
Hi everyone. Firstly i would like to acknowledge how much i have been able to learn from all your comments in the forum, so thank you.
I would like to share with you my case. My partner and I bought a property in 2010, where we are living, in a town south of Sydney with the idea of making it an IP. So we took on a IO Loan with…[Read more]

Being fixed doesn't mean you cannot set up a new loan with the same bank – and Benny's suggestion is good too.

Many ways you could do something like this. some are:

1. approach the owners of the property
2. Find someone to invest with you
3. Find a builder – you arrange a profit split
4. find someone to lend you money
5. you lend someone money and they buy it
6. Use a unit trust to invest.

etc

Finance should be structured under normal principals. Initially you would want to borrow as much as possible. Ideally 104%. Borrow the costs to strata title too.

Once strata titled sell off the units you want to and then split the loan so there is a portion for each unit. All loans IO and an offset account attached to the one you are living it.…[Read more]

Terryw wrote:
One of my goals is to be legally able to offer advice on 4 main areas of investing 1 law 2 financial planning 3 finance 4 taxation. I plan to open my own law firm and a separate company for financial planning. Aim is first half of 2013

Wow 12 months have passed and it seems like much longer.

I opened my firm, FinLaw Pty Ltd, in…[Read more]

I don't think it would make a difference. Interest accrues daily but is charged monthly. So if you make a deposit to the loan account the day after interest is taken it will benefit you by reducing the principal until the next payment of interest.

But it won't be an issue with hte offset account.

Do you mean there is one title for the whole block?

If so the owner will not be able to sell this unit separately. They would be to be strata titled.

Jacqui

sounds like you are doing very well!

Think if it this way, if you were to go bankrupt the banks would take the property securing your debt to them. Any other assets would be up for grabs. But if you don't own anything and have little equity then there will be nothing for creditors to take – this could discourage them from suing you in the first place.

Yes. but that really means you have little to no assets!

I was a mortgage broker for several years and then started studying law and became a lawyer. It was a lot of work and took about 5 years but now I wish I had done it sooner. Given your tax background you may even get some exemptions too – and you can still give similar advice to what you are doing now, but get paid double! So why not become a…[Read more]