To be able to claim interedt the borrowed money needs to be used for income producing purposes.

If you borrow money and gift it to a trust you cannot claim the interest.

If you onlend it to a trust you could claim the interest if it is a commercial transaction. That woukd mean charge the trust at least what you pay in interest. This would be…[Read more]

Mortgage duty has been abolished in NSW for personal borrowers.

There is an exemption from stamp duty on the transfer of land in NSW upon relationship breakdowns, but certain conditions need to be met. He should seek legal and tax advice as I was talking to an accountant this morning whose client did something similar and stuffed things up.

tom123 wrote:
whys that?

Too risky and too many complex legal issues so high potential for disputes and therefore litigation.

tom123 wrote:
i see, cause my orginal idea was to go buy houses by baby sitting a loan strategy so i wouldn't need to pay stamp duty or a deposit. then rent it out as a buy and hold and just keep doing that. 

would you say it's more of a short term strategy then?

Cheers, Tom

Don’t really see it as a strategy at all!

Must be a non bank lender – these are often best avoided.

tom123 wrote:
Hi Terry,

with baby sitting a loan, could i do this as a buy and hold stategy? also what are the disadvantages for the vendor by letting me do this with their loan?

You possibly could. But this would be potentially dangerous for both parties so seek legal advice.

Disadvantage for the vendor is that he/she is giving someone an…[Read more]

GrantMck wrote:
Hi Wilko1,

The ATO is forever changing the legislation and policies. The last amendment was on the 20 th June 2013. I have noted two useful links into the ATO website which will explain a few different scenario's and also the 2013 Property Investment Guide.

A little research upfront is always advisable because if the ATO start…[Read more]

Wilko, could be uncrossing a cross, but

Cross collateralising loans is when there are 2 securities for 1 loan. (ie the collateral/security is crossed, not the loan).

Possible, depends on the circumstances.

see steele case

Not sure if I read you post right, but if he is combining loans then it may be difficult to apportion interest, especially if extra repayments are made and/or one is sold.

And, if he gets into financial trouble and goes to sell one property to release some cash to pay out his problems, then the bank could step in and take the proceeds forcing him…[Read more]

He is doing something that could cause him problems in the future.

2 main issues are tax and asset protection – if he gets into financial difficulty it may be more difficulty for him to control the situation.

Why not do both!

Buy PPOR and later rent it out, claim everything, but still apply the main residence CGT exemption under s118-145.

Wow, thasi a good position. make sure you get some legal advice on tax and asset protection strategies too

A lease is just a contract so the normal laws of contract would apply if the RTA didn't.

This section probably relates to situations where owners sell a property and then remain their for up to 2 months before moving into their new property.

When buying a 'house' you are actually being land with the house attached. technically the house is a fixture – it becomes part of the land. So the house is usually owned under the same structure as the land is owned.

There are rare exceptions such as on leased land the building is often constructed and owned by the tenant.

I did mine thru AAMC. Pretty good, although I did mine over the net.

From a qualifications perspective I don't think it matters one bit who you study under as long as you get the piece of paper needed at the end of it.

Hi John,

Transferring to a trust will not assist your serviceability for more loans. This is because being guarantor for a loan is assessed in the same way as being a borrower.
Having the property in your own name would also assist your retirement.

Transfer is not as simple as changing names on titles. You will need to seek legal advice – from a…[Read more]

Hi John,

Before I comment on your proposal may I ask the following:

1. Why do you want to do this?, and

2. Which State is the property located in at the moment?

3. What is the current loan on the property and what is the current value?

4. Would it be a good investment? i.e. would you want to buy it again now if you had your chance again.

The 99/1% structure is not a good idea at the best of times. Owning 1% is virtually worthless but being on title it exposes the person to large asset protection issues because they will need to guarantee/be on the loan for that property. It does give some control in that the property cannot be sold withou the approval of the 1% owner, but this…[Read more]

Pimobpi,

Either way the CGT would be paid on market value.
But it could be more beneficial to pay market value – if mum goes bankrupt at a later date this transaction could be reversed, or at least scrutinised carefully..
Same with the gift of cash, but this would be easier to cope with.

Also transferring at market value can assist with asset…[Read more]